Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2024 | Aug. 12, 2024 | |
Cover [Abstract] | ||
Entity Registrant Name | EMMAUS LIFE SCIENCES, INC. | |
Entity Central Index Key | 0000822370 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2024 | |
Amendment Flag | false | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2024 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-35527 | |
Entity Tax Identification Number | 87-0419387 | |
Entity Incorporation State Country Code | DE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Address, Address Line One | 21250 Hawthorne Boulevard | |
Entity Address, Address Line Two | Suite 800 | |
Entity Address, City or Town | Torrance | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 90503 | |
City Area Code | 310 | |
Local Phone Number | 214-0065 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Common Stock, Shares Outstanding | 63,865,571 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 1,712 | $ 2,547 |
Accounts receivable, net | 2,990 | 5,524 |
Inventories, net | 1,527 | 1,711 |
Prepaid expenses and other current assets | 1,615 | 1,727 |
Total current assets | 7,844 | 11,509 |
Property and equipment, net | 57 | 59 |
Right of use assets | 2,082 | 2,337 |
Investment in convertible bond | 19,250 | 20,978 |
Other assets | 310 | 296 |
Total assets | 29,543 | 35,179 |
CURRENT LIABILITIES | ||
Accounts payable and accrued expenses | 18,187 | 17,725 |
Operating lease liabilities, current portion | 869 | 865 |
Conversion feature derivative, notes payable | 1,360 | 451 |
Other current liabilities | 14,858 | 14,681 |
Warrant derivative liabilities | 74 | 65 |
Convertible notes payable, net of discount | 16,588 | 16,383 |
Total current liabilities | 62,428 | 61,507 |
Operating lease liabilities, less current portion | 1,561 | 1,839 |
Other long-term liabilities | 16,967 | 17,363 |
Total liabilities | 83,187 | 82,935 |
STOCKHOLDERS’ DEFICIT | ||
Preferred stock, par value $0.001 per share, 15,000,000 shares authorized, none issued or outstanding | ||
Common stock, par value $0.001 per share, 250,000,000 shares authorized, 61,845,963 shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively | 62 | 62 |
Additional paid-in capital | 225,503 | 225,333 |
Net loan receivable from EJ Holdings | (16,869) | (16,869) |
Accumulated other comprehensive loss | (1,870) | (160) |
Accumulated deficit | (260,470) | (256,122) |
Total stockholders’ deficit | (53,644) | (47,756) |
Total liabilities & stockholders’ deficit | 29,543 | 35,179 |
Nonrelated Party [Member] | ||
CURRENT LIABILITIES | ||
Notes payable, current portion, net of discount | 7,720 | 8,215 |
Related Party [Member] | ||
CURRENT LIABILITIES | ||
Notes payable, current portion, net of discount | 2,772 | 3,122 |
Notes payable, less current portion, net of discount | $ 2,231 | $ 2,226 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (Unaudited) - $ / shares | Mar. 31, 2024 | Dec. 31, 2023 |
Statement Of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized | 15,000,000 | 15,000,000 |
Preferred stock, issued | 0 | 0 |
Preferred stock, outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized | 250,000,000 | 250,000,000 |
Common stock, issued | 61,845,963 | 61,845,963 |
Common stock, outstanding | 61,845,963 | 61,845,963 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Statement [Abstract] | ||
REVENUES, NET | $ 2,506 | $ 6,753 |
COST OF GOODS SOLD | 257 | 429 |
GROSS PROFIT | 2,249 | 6,324 |
OPERATING EXPENSES | ||
Research and development | 183 | 289 |
Selling | 1,937 | 2,317 |
General and administrative | 2,869 | 4,883 |
Total operating expenses | 4,989 | 7,489 |
LOSS FROM OPERATIONS | (2,740) | (1,165) |
OTHER INCOME (EXPENSE) | ||
Change in fair value of warrant derivative liabilities | (8) | 62 |
Change in fair value of conversion feature derivative, notes payable | (907) | 89 |
Net loss on equity method investment | 0 | (527) |
Gain on restructured debt | 1,032 | |
Foreign exchange gain (loss) | 31 | (519) |
Interest and other income | 147 | 160 |
Interest expense | (1,910) | (1,502) |
Total other expense | (1,615) | (2,237) |
LOSS BEFORE INCOME TAXES | (4,355) | (3,402) |
Income tax provision (benefit) | (7) | 49 |
NET LOSS | (4,348) | (3,451) |
COMPONENTS OF OTHER COMPREHENSIVE LOSS | ||
Unrealized loss on debt securities available for sale (net of tax) | (1,728) | (544) |
Translation adjustment, net of tax | 18 | 186 |
Other comprehensive loss | (1,710) | (358) |
COMPREHENSIVE LOSS | $ (6,058) | $ (3,809) |
NET LOSS PER COMMON SHARE - BASIC | $ (0.07) | $ (0.07) |
NET LOSS PER COMMON SHARE - DILUTED | $ (0.07) | $ (0.07) |
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING - BASIC | 61,845,963 | 50,709,627 |
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING - DILUTED | 61,845,963 | 50,709,627 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT (Unaudited) - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-In Capital [Member] | Loan Receivable From EJ Holdings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Accumulated Deficit [Member] |
Balance, beginning at Dec. 31, 2022 | $ (34,091) | $ 50 | $ 220,815 | $ (2,619) | $ (252,337) | |
Balance, beginning (in shares) at Dec. 31, 2022 | 49,583,501 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Fair value of warrants including down-round protection adjustments | 41 | (41) | ||||
Convertible notes converted to shares (in shares) | 1,351,351 | |||||
Convertible notes converted to shares | 500 | $ 1 | 499 | |||
Share-based compensation | 38 | 38 | ||||
Unrealized loss on debt securities available for sale (net of tax) | (544) | (544) | ||||
Foreign currency translation effect | 186 | 186 | ||||
Net loss | (3,451) | (3,451) | ||||
Balance, ending at Mar. 31, 2023 | (37,362) | $ 51 | 221,393 | (2,977) | (255,829) | |
Balance, ending (in shares) at Mar. 31, 2023 | 50,934,852 | |||||
Balance, beginning at Dec. 31, 2023 | (47,756) | $ 62 | 225,333 | $ (16,869) | (160) | (256,122) |
Balance, beginning (in shares) at Dec. 31, 2023 | 61,845,963 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Share-based compensation | 170 | 170 | ||||
Unrealized loss on debt securities available for sale (net of tax) | (1,728) | (1,728) | ||||
Foreign currency translation effect | 18 | 18 | ||||
Net loss | (4,348) | (4,348) | ||||
Balance, ending at Mar. 31, 2024 | $ (53,644) | $ 62 | $ 225,503 | $ (16,869) | $ (1,870) | $ (260,470) |
Balance, ending (in shares) at Mar. 31, 2024 | 61,845,963 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss | $ (4,348) | $ (3,451) |
Adjustments to reconcile net loss to net cash flows provided by (used in) operating activities | ||
Depreciation and amortization | 6 | 9 |
Inventory reserve | 12 | |
Amortization of discount of notes payable and convertible notes payable | 494 | 582 |
Foreign exchange adjustments | (113) | 471 |
Net loss on equity method investment | 0 | 527 |
Gain on restructured debt | (1,032) | |
Share-based compensation | 170 | 1,189 |
Fair value of warrants issued for services | 334 | |
Change in fair value of warrant derivative liabilities | 8 | (62) |
Change in fair value of conversion feature derivative, notes payable | 907 | (89) |
Changes in fair value option instrument | 10 | |
Net changes in operating assets and liabilities | ||
Accounts receivable | 2,533 | (1,828) |
Inventories | 166 | 161 |
Prepaid expenses and other current assets | 135 | 241 |
Other non-current assets | 215 | 186 |
Accounts payable and accrued expenses | 1,472 | 1,001 |
Other current liabilities | (316) | (545) |
Other long-term liabilities | (169) | (28) |
Net cash flows provided by (used in) operating activities | 140 | (1,292) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of property and equipment | (4) | (6) |
Loan to equity method investee | (1,085) | |
Net cash flows used in investing activities | (4) | (1,091) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from notes payable issued | 1,400 | 1,484 |
Proceeds from notes payable issued, related parties | 227 | |
Proceeds from convertible notes payable issued, related party | 1,000 | |
Payments of notes payable | (1,805) | (520) |
Payments of notes payable, related party | (350) | (50) |
Payments of convertible notes | (200) | |
Net cash flows provided by (used in) financing activities | (955) | 2,141 |
Effect of exchange rate changes on cash | (16) | (5) |
Net decrease in cash and cash equivalents | (835) | (247) |
Cash and cash equivalents, beginning of period | 2,547 | 2,021 |
Cash and cash equivalents, end of period | 1,712 | 1,774 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW ACTIVITIES | ||
Interest paid | 873 | 276 |
Income taxes paid | $ 16 | 1 |
NON-CASH INVESTING AND FINANCING ACTIVITIES | ||
Renewal of notes payable including interests capitalized | 926 | |
Conversion of convertible note payable to common stock | $ 500 |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 3 Months Ended |
Mar. 31, 2024 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | NOTE 1 — BASIS OF PRESENTATION The accompanying unaudited condensed consolidated interim financial statements of Emmaus Life Sciences, Inc., (“Emmaus”) and its direct and indirect consolidated subsidiaries (collectively, “we,” “our,” “us” or the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) on the basis that the Company will continue as a going concern. All significant intercompany transactions have been eliminated. The Company’s unaudited condensed consolidated interim financial statements contain adjustments, including normal recurring accruals necessary to fairly state the Company’s consolidated financial position, results of operations and cash flows. The condensed consolidated interim financial statements should be read in conjunction with the Annual Report on Form 10-K for the year ended December 31, 2023 (the “Annual Report”) filed with the Securities and Exchange Commission (“SEC”) on July 3, 2024. The accompanying condensed consolidated balance sheet at December 31, 2023 has been derived from the audited consolidated balance sheet at December 31, 2023 contained in the Annual Report. The results of operations for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for the full year or any future interim period. Nature of Operations The Company is a commercial-stage biopharmaceutical company engaged in the discovery, development, marketing and sales of innovative treatments and therapies, primarily for rare and orphan diseases. The Company’s only product, Endari® (prescription grade L-glutamine oral powder), is approved by the U.S. Food and Drug Administration, or FDA, and in certain jurisdictions in the Middle East North Africa, or MENA, region to reduce the acute complications of sickle cell disease (“SCD”) in adult and pediatric patients five years of age and older. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Company’s significant accounting policies are described in Note 2, “Summary of Significant Accounting Policies,” in the Annual Report. There have been no material changes in these policies or their application. Going concern — The accompanying unaudited condensed consolidated financial statements have been prepared on the basis that the Company will continue as a going concern. The Company incurred a net loss of $ 4.3 million for the three months ended March 31, 2024 and had a working capital deficit of $ 54.6 million as of March 31, 2024. Management expects that the Company’s current liabilities, operating losses and expected capital needs, including debt service on its existing indebtedness and the expected costs relating to the commercialization of Endari® in the MENA region and elsewhere will exceed its existing cash balances and cash expected to be generated from operations for the foreseeable future. To meet the Company’s current liabilities and future obligations, the Company will need to restructure or refinance its existing indebtedness and raise additional funds through related-party loans, third-party loans, equity or debt financings or licensing or other strategic agreements. Except as described below under "Factoring accounts receivable," the Company has no understanding or arrangement for any additional financing, and there can be no assurance that the Company will be able to restructure or refinancing its existing indebtedness or obtain additional related-party or third-party loans or complete any additional equity or debt financings on favorable terms, or at all, or enter into licensing or other strategic arrangements. Due to the uncertainty of the Company’s ability to meet its current liabilities and operating expenses, there is substantial doubt about the Company’s ability to continue as a going concern for 12 months from the date that these condensed consolidated financial statements are issued. The condensed consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties. Management has considered all recent accounting pronouncements and determined that they will not have a material effect on the Company’s condensed consolidated financial statements. Prior period misclassification - During the quarter ended June 30, 2023, the Company identified a misclassification related to common stock warrants that were issued in January 2023. The common stock warrants were incorrectly recorded in additional paid-in capital at their estimated fair value of $ 1.5 million, but should have been recorded as warrant derivative liabilities, as they did not qualify for equity classification in accordance with ASC815-40-25-10. The correction of the misclassification in the condensed consolidated financial statements is reflected for the three months ended March 31, 2023. The Company believes the correction of the misclassification is quantitatively and qualitatively immaterial to the previously issued condensed consolidated financial statements. The condensed consolidated statements of changes in stockholders’ deficit included in this Quarterly Report differ from the previously filed Form 10-Q’s for period ended March 2023, reflecting the misclassification of $ 1.4 million as additional paid-in capital and warrant derivative liability for warrants issued in January 2023. Factoring accounts receivable — Emmaus Medical, Inc., or Emmaus Medical, the Company's indirect wholly owned subsidiary, has entered into a purchase and sales agreement with Prestige Capital Finance, LLC or Prestige Capital, pursuant to which Emmaus Medical may offer and sell to Prestige Capital from time to time eligible accounts receivable in exchange for Prestige Capital’s down payment, or advance, to Emmaus Medical of 65 % to 80 % of the face amount of the eligible accounts receivable, subject to a $ 7.5 million cap on advances at any time. The balance of the face amount of the accounts receivable is reserved by Prestige Capital and paid to Emmaus Medical, less discount fees of Prestige Capital ranging from 2.25 % to 7.25 % of the face amount, as and when Prestige Capital collects the entire face amount of the accounts receivable. Emmaus Medical’s obligations to Prestige Capital under the purchase and sale agreement are secured by a security interest in the accounts receivable and all or substantially all other assets of Emmaus Medical. In connection with the purchase and sale agreement, Emmaus has guaranteed Emmaus Medical’s obligations under the purchase and sale agreement. Accounts receivable included approximately $ 40,000 and $ 1,514,000 of factored accounts receivable and other current liabilities included approximately $ 1,000 and $ 24,000 of liabilities from factoring at March 31, 2024 and December 31, 2023, respectively. For the three months ended March 31, 2024 and 2023 , the Company incurred approximately $ 87,000 and $ 108,000 , respectively, of factoring fees. Net loss per share — In accordance with Accounting Standard Codification (“ASC”) 260, “Earnings per Share, ” the basic net loss per common share is computed by dividing net loss available to common stockholders by the weighted-average number of common shares outstanding. Diluted net loss per share is computed in a similar manner, except that the denominator is increased to include the number of additional shares of common stock that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. As of March 31, 2024 and March 31, 2023, the Company had outstanding potentially dilutive securities exercisable for or convertible into 112,942,491 shares and 61,174,436 shares, respectively, of common stock. No potentially dilutive securities were included in the calculation of diluted net loss per share, since the effect would have been anti-dilutive for the each of the three months ended March 31, 2024 and March 31, 2023 . |
REVENUES
REVENUES | 3 Months Ended |
Mar. 31, 2024 | |
Revenue From Contract With Customer [Abstract] | |
REVENUES | NOTE 3 — REVENUES Revenues disaggregated by category were as follows (in thousands): Three months ended March 31, 2024 2023 Endari® $ 2,344 $ 6,515 Other 162 238 Revenues, net $ 2,506 $ 6,753 The following table summarizes the revenue allowance and accrual activities for the three months ended March 31, 2024 and March 31, 2023 (in thousands): Trade Discounts, Allowances and Chargebacks Government Rebates and Other Incentives Returns Total Balance as of December 31, 2023 $ 1,212 $ 5,658 $ 863 $ 7,733 Provision related to sales in the current year 205 577 25 807 Adjustments related to prior period sales ( 50 ) 51 — 1 Credits and payments made ( 529 ) ( 553 ) ( 645 ) ( 1,727 ) Balance as of March 31, 2024 $ 838 $ 5,733 $ 243 $ 6,814 Balance as of December 31, 2022 $ 1,358 $ 3,718 $ 415 $ 5,491 Provision related to sales in the current year 425 819 106 1,350 Adjustments related to prior period sales ( 213 ) 130 — ( 83 ) Credits and payments made ( 716 ) ( 597 ) ( 150 ) ( 1,463 ) Balance as of March 31, 2023 $ 854 $ 4,070 $ 371 $ 5,295 The following table summarizes revenues attributable to each of our customers that accounted for 10% or more of our net revenues in any of the periods shown: Three months ended March 31, 2024 2023 Customer A 46 % 20 % Customer B 39 % 15 % Customer D 2 % 16 % Customer F 1 % 23 % On June 15, 2017, the Company entered into a distributor agreement with Telcon RF Pharmaceutical, Inc., or Telcon, pursuant to which it granted Telcon exclusive rights to the Company’s prescription grade L-glutamine (“PGLG”) oral powder for the treatment of diverticulosis in South Korea, Japan and China in exchange for Telcon’s payment of a $ 10 million upfront fee and agreement to purchase from the Company specified minimum quantities of the PGLG. Telcon had the right to terminate the distributor agreement in certain circumstances for failure to obtain such product registrations, in which event the Company is obliged to repay Telcon the $ 10 million upfront fee. In January, 2023, Telcon terminated the distributor agreement, and the upfront fee of $ 10 million is included as unearned revenue in other current liabilities as of March 31, 2024 and December 31, 2023 . See Notes 6, 11 and 12 and for additional details of the Company's agreements with Telcon. |
SELECTED FINANCIAL STATEMENT -
SELECTED FINANCIAL STATEMENT - ASSETS | 3 Months Ended |
Mar. 31, 2024 | |
Balance Sheet Related Disclosures [Abstract] | |
SELECTED FINANCIAL STATEMENT - ASSETS | NOTE 4 — SELECTED FINANCIAL STATEMENT — ASSETS Inventories consisted of the following (in thousands): March 31, 2024 December 31, 2023 Raw materials and components $ 1,313 $ 1,329 Work-in-process 200 186 Finished goods 4,993 5,163 Inventory reserve ( 4,979 ) ( 4,967 ) Total inventories, net $ 1,527 $ 1,711 Prepaid expenses and other current assets consisted of the following (in thousands): March 31, 2024 December 31, 2023 Prepaid insurance $ 411 $ 595 Prepaid expenses 442 536 Other current assets 762 596 Total prepaid expenses and other current assets $ 1,615 $ 1,727 Property and equipment consisted of the following (in thousands): March 31, 2024 December 31, 2023 Equipment $ 384 $ 383 Leasehold improvements 39 39 Furniture and fixtures 99 99 Total property and equipment 522 521 Less: accumulated depreciation ( 465 ) ( 462 ) Total property and equipment, net $ 57 $ 59 During the three months ended March 31, 2024 and 2023 , depreciation expense was approximately $ 6,000 and $ 9,000 , respectively. |
INVESTMENTS
INVESTMENTS | 3 Months Ended |
Mar. 31, 2024 | |
Investments [Abstract] | |
INVESTMENTS | NOTE 5 — INVESTMENTS Investment in convertible bond - On September 28, 2020, the Company entered into a convertible bond purchase agreement pursuant to which it purchased at face value a convertible bond of Telcon in the principal amount of approximately $ 26.1 million which matures on October 16, 2030 and bears interest at the rate of 2.1 % per year, payable quarterly. Beginning October 16, 2021, the Company became entitled on a quarterly basis to call for early redemption of all or any portion of the principal amount of the convertible bond. The convertible bond is convertible at the holder’s option at any time and from time to time into common shares of Telcon at an initial conversion price of KRW 9,232 , or approximately $ 8.00 per share. The initial conversion price is subject to downward adjustment monthly based on the volume-weighted average market price of Telcon shares as reported on Korean Securities Dealers Automated Quotations Market and in the event of the issuance of Telcon shares or share equivalents at a price below the market price of Telcon shares and to customary antidilution adjustments upon a merger or similar reorganization of Telcon or a stock split, reverse stock split, stock dividend or similar event. As of March 31, 2024 and December 31, 2023, the principal amount of the convertible note was KRW 23.6 billion, or approximately $ 17.5 million. The conversion price as of March 31, 2024 is set forth in the “Investment in convertible bond” table below. The convertible bond and any proceeds therefrom, including proceeds from any exercise of the early redemption right described above or the call option described below, are pledged as collateral to secure the Company’s obligations under the revised API Supply Agreement with Telcon described in Notes 6, 11 and 12. Concurrent with the purchase of the convertible bond, the Company entered into an agreement dated September 28, 2020 with Telcon pursuant to which Telcon or its designee is entitled to repurchase, at par, up to 50 % in principal amount of the convertible bond at any time and from time to time commencing October 16, 2021 and prior to maturity. The investment in convertible bond is classified as an available for sale security and remeasured at fair value on a recurring basis using Level 3 inputs, with any changes in the fair value option recorded in other comprehensive loss. The fair value and any changes in fair value in the convertible bond is determined using a binominal lattice model. The model produces an estimated fair value based on changes in the price of the underlying common stock over successive periods of time. The revised API agreement with Telcon described in Note 6 provides for target annual revenue of more than $ 5 million and annual “profit” ( i.e ., sales margin) to Telcon of $ 2.5 million. To the extent these targets are not met, which management refers to as a “target shortfall,” Telcon may be entitled to payment of the target shortfall or to settle the target shortfall by exchange of principal and interest on the Telcon convertible bond and proceeds thereof that are pledged as a collateral to secure the Company’s obligations under the API Supply Agreement and the revised API Agreement. In April 2023, Telcon offset KRW 2.9 billion, or approximately US$ 2.2 million, against the principal amount of the Telcon convertible bond and release of KRW 307 million, or approximately $ 236,000 , in cash proceeds to Telcon in satisfaction the target shortfall for the year ended 2022. The offset is reflected as a sale of the convertible bond in the “Investment in convertible bond” table below. As a result, the Company realized a net gain on investment in convertible bond of $ 106,000 , which previously was classified as unrealized loss on debt securities available-for-sale in the other comprehensive loss. The following table sets forth the fair value and changes in fair value of the investment in the Telcon convertible bond as of March 31, 2024 and December 31, 2023 (in thousands): Investment in convertible bond March 31, 2024 December 31, 2023 Balance, beginning of period $ 20,978 $ 19,971 Sales of convertible bond — ( 2,232 ) Net gain on investment on convertible bond — 106 Change in fair value included in the statement of other comprehensive income ( 1,728 ) 3,133 Balance, end of period $ 19,250 $ 20,978 The fair value as of March 31, 2024 and December 31, 2023 was based upon following assumptions: March 31, 2024 December 31, 2023 Principal outstanding (South Korean won) KRW 23.6 billion KRW 23.6 billion Stock price KRW 804 KRW 873 Expected life (in years) 6.54 6.79 Selected yield 12.75 % 12.25 % Expected volatility (Telcon common stock) 71.10 % 71.90 % Risk-free interest rate (South Korea government bond) 3.37 % 3.16 % Expected dividend yield — — Conversion price KRW 705 (US$ 0.53 ) KRW 705 (US$ 0.54 ) Equity method investment – In 2018, the Company and Japan Industrial Partners, Inc., or JIP, formed EJ Holdings, Inc., or EJ Holdings, to acquire, own and operate a former amino acids manufacturing facility in Ube, Japan. In connection with the formation, the Company invested approximately $ 32,000 in exchange for 40 % of EJ Holdings' capital shares. JIP owned 60 % of EJ Holdings' capital shares. In October 2018, the Company entered into a loan agreement with EJ Holdings under which the Company made an unsecured loan to EJ Holdings in the amount of $ 13.6 million bearing interest at the rate of 1 %, payable annually . The loan proceeds were used by EJ Holdings to purchase the Ube facility in December 2019 and pay related taxes. One half of the principal amount of the loan (JPY 1,818,667,860 ) becomes due and payable on December 28, 2027 and the remaining principal balance become due on September 30, 2028 . During the year ended December 31, 2023, the Company made additional loans to EJ Holdings of $ 2.6 million. The Company suspended any further loans to EJ Holdings in August 2023. EJ Holdings is engaged in seeking to refurbish and phase in the Ube facility with objective of eventually obtaining regulatory clearance for the manufacture of PGLG in accordance with cGMP. EJ Holdings has had no substantial revenues since its inception, has depended on loans from the Company to acquire the Ube facility and fund its operations and will be dependent on loans from other financing unless and until its plant is activated and it can secure customers for its products. There is no assurance that needed funding will be available from other sources. If EJ Holdings fails to obtain needed funding, it may need to suspend activities at the Ube plant. Under the asset purchase agreement by which EJ Holdings purchased the Ube plant, the seller has the right to repurchase the plant at the purchase price, plus certain taxes, paid by EJ Holdings if the plant does not become operational within a reasonable period of time not to exceed five years, or approximately the end of 2024. In such event, it is likely that EJ Holdings would be unable to pay some or all the Company's loans. On December 28, 2023, the Company sold and assigned its EJ Holdings shares at their cost of JPY 3.6 million or US$ 25,304 to Niihara International, Inc., which was formed by Yutaka Niihara, M.D., Ph. D., the former Chairman and Chief Executive Officer of the Company and a principal stockholder of the Company. In connection with the sale and assignment, the Company derecognized its investment in EJ Holdings, including $ 1.5 million of currency translation adjustments recorded in other comprehensive loss. As of March 31, 2024 and December 31, 2023, the loan receivable from EJ Holdings was $ 25.8 million. The net loan receivable from EJ Holdings was $ 16.9 million as reflected in net loan receivable from EJ Holdings as contra-equity on the consolidated balance sheets. |
SELECTED FINANCIAL STATEMENT CA
SELECTED FINANCIAL STATEMENT CAPTIONS - LIABILITIES | 3 Months Ended |
Mar. 31, 2024 | |
Payables And Accruals [Abstract] | |
SELECTED FINANCIAL STATEMENT CAPTIONS - LIABILITIES | NOTE 6 — SELECTED FINANCIAL STATEMENT - LIABILITIES Accounts payable and accrued expenses consisted of the following at March 31, 2024 and December 31, 2023 (in thousands): March 31, 2024 December 31, 2023 Accounts payable: Clinical and regulatory expenses $ 670 $ 696 Professional fees 861 721 Selling expenses 1,807 1,498 Manufacturing costs 891 914 Non-employee director compensation 839 766 Other vendors 1,497 1,292 Total accounts payable 6,565 5,887 Accrued interest payable, related parties 587 542 Accrued interest payable 2,516 3,122 Accrued expenses: Payroll expenses 1,251 1,270 Government rebates and other rebates 7,181 5,881 Due to customers — 844 Other accrued expenses 87 179 Total accrued expenses 8,519 8,174 Total accounts payable and accrued expenses $ 18,187 17,725 Other current liabilities consisted of the following at March 31, 2024 and December 31, 2023 (in thousands): March 31, 2024 December 31, 2023 Trade discount $ 3,500 $ 3,000 Unearned revenue (a) 10,000 10,000 Other current liabilities 1,358 1,681 Total other current liabilities $ 14,858 $ 14,681 (a) Refer to Note 3 for information regarding to the unearned revenue. Other long-term liabilities consisted of the following at March 31, 2024 and December 31, 2023 (in thousands): March 31, 2024 December 31, 2023 Trade discount $ 16,928 $ 17,324 Other long-term liabilities 39 39 Total other long-term liabilities $ 16,967 $ 17,363 On June 12, 2017, the Company entered into an API Supply Agreement with Telcon pursuant to which Telcon advanced to the Company approximately $ 31.8 million as an advance trade discount in consideration of the Company’s agreement to purchase from Telcon the Company’s estimated annual target for bulk containers of PGLG. On July 12, 2017, the Company entered into a raw material supply agreement with Telcon which revised certain items of the API Supply Agreement (the “revised API Agreement”). The Company purchased $ 125,000 and $ 310,000 of PGLG from Telcon for three months ended March 31, 2024 and three months ended March 31, 2023 , respectively, of which $ 904,000 an d $ 962,000 were reflected in accounts payable as of March 31, 2024 and December 31, 2023 , respectively. The revised API Agreement provided for an annual API purchase target of $ 5 million and a target “profit” ( i.e. , gross margin) to Telcon of $ 2.5 million. To the extent these targets are not met, which management refers to as a “target shortfall,” Telcon may be entitled to payment of the target shortfall or to settle the target shortfall by exchange of principal and interest on the Telcon convertible bond and proceeds thereof that are pledged as a collateral to secure the Company’s obligations under the API Supply Agreement and the revised API Agreement. See Note 5 for information regarding the settlement of the target shortfall for the year ended December 31, 2023 . |
NOTES PAYABLE
NOTES PAYABLE | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
NOTES PAYABLE | NOTE 7 — NOTES PAYABLE Notes payable consisted of the following at March 31, 2024 and December 31, 2023 (in thousands except for number of underlying shares): Year Interest Rate Term of Notes Conversion Principal Unamortized Discount March 31, 2024 Carrying Underlying Shares March 31, 2024 Notes payable 2013 10 % Due on demand — $ 661 $ — $ 661 — 2022 10 %- 12 % Due on demand — 1,264 — 1,264 — 2023 11 %- 40 % Due on demand - 32 weeks — 4,428 33 4,395 — 2024 30 % 2 month — 1,400 — 1,400 — $ 7,753 $ 33 $ 7,720 — Current $ 7,753 $ 33 $ 7,720 — Notes payable - related parties 2020 12 % Due on demand — 100 — 100 — 2021 12 % Due on demand — 700 — 700 — 2022 10 %- 12 % Due on demand - 5 years — 3,716 90 3,626 — 2023 10 %- 60 % Due on demand - 2 month — 577 — 577 $ 5,093 $ 90 $ 5,003 — Current $ 2,772 $ — $ 2,772 — Non-current $ 2,321 $ 90 $ 2,231 — Convertible notes payable 2021 10 % Due on demand $ 0.13 (b) 1,380 — 1,380 12,605,099 2023 12 % 6 months $ 10.00 (a) 3,150 — 3,150 347,535 2023 10 % 1 year $ 0.29 1,000 2 998 3,645,725 2024 10 % 1 year $ 0.13 11,060 — 11,060 86,627,725 $ 16,590 $ 2 $ 16,588 103,226,084 Current $ 16,590 $ 2 $ 16,588 103,226,084 Total $ 29,436 $ 125 $ 29,311 103,226,084 Year Interest Rate Term of Notes Conversion Principal Unamortized Carrying Underlying Shares Notes payable 2013 10 % Due on demand — $ 709 $ — $ 709 — 2022 10 % - 12 % Due on demand — 1,284 — 1,284 — 2023 10 % - 57 % Due on demand - 56 months — 6,337 115 $ 6,222 — $ 8,330 $ 115 $ 8,215 — Current $ 8,330 $ 115 $ 8,215 — Notes payable - related parties 2020 12 % Due on demand — 100 — 100 — 2021 12 % Due on demand — 700 — 700 — 2022 6 %- 12 % Due on demand - 5 years — 3,716 95 3,621 — 2023 10 %- 60 % Due on demand - 2 months — 927 — 927 $ 5,443 $ 95 $ 5,348 — Current $ 3,122 $ — $ 3,122 — Non-current $ 2,321 $ 95 $ 2,226 — Convertible notes payable 2021 2 % 3 years $ 0.13 12,640 407 12,233 113,009,154 2023 13 % Due on demand $ 10.00 (a) 3,150 — 3,150 337,326 2023 10 % 1 year $ 0.29 1,000 — 1,000 3,559,754 $ 16,790 $ 407 $ 16,383 $ 116,906,234 Current $ 16,790 $ 407 $ 16,383 $ 116,906,234 Total $ 30,563 $ 617 $ 29,946 $ 116,906,234 (a) This note is convertible into shares of EMI Holding, Inc., a wholly owned subsidiary of Emmaus Life Sciences, Inc . (b) The stated interest for the notes was 2 %. As the loan is default as of March 31, 2024, the default interest rate is applicable. The weighted-average stated annual interest rate of notes payable was 12 % for both periods ended March 31, 2024 and December 31, 2023. The weighted-average effective annual interest rate of notes payable as of March 31, 2024 and December 31, 2023 was 13 % and 23 % , respectively, after giving effect to discounts relating to conversion features, warrants and deferred financing costs relating to the notes. As of March 31, 2024, future contractual principal payments due on notes payable were as follows (in thousands): Year Ending 2024 (nine months) $ 27,115 2025 — 2026 — 2027 2,321 Total $ 29,436 On February 9, 2021, the Company entered into a securities purchase agreement pursuant to which the Company agreed to sell and issue to the purchasers thereunder in a private placement pursuant to Rule 4(a)(2) of the Securities Act of 1933, as amended, and Regulation D thereunder a total of up to $ 17 million in principal amount of convertible promissory notes of the Company for a purchase price equal to the principal amount thereof. The Company sold and issued approximately $ 14.5 million of the convertible promissory notes. Commencing one year from the original issue date, the convertible promissory notes became convertible at the option of the holder into shares of the Company’s common stock at an initial conversion price of $ 1.48 per share, which equaled the “Average VWAP” (as defined) of the Company’s common stock on the effective date. The initial conversion price is subject to adjustment as of the end of each three-month period following the original issue date, commencing May 31, 2021, to equal the Average VWAP as of the end of such three-month period if such Average VWAP is less than the then-conversion price. There is no floor on the conversion price. The conversion price will be subject to further adjustment in the event of a stock split, reverse stock split or certain other events specified in the convertible promissory notes. In January 2023, $ 500,000 principal amount of the convertible promissory notes was converted into 1,351,351 shares of the Company's common stock. In February 2024, the Company repaid $ 200,000 principal amount and accrued interests to two of the note holders. As of March 31, 2024, the conversion price was $ 0.13 per share. The convertible promissory notes bear interest at the rate of 2 % per year, payable semi-annually on the last business day of August and January of each year and will mature on the 3rd anniversary of the original issue date, unless earlier converted or prepaid. The convertible promissory notes are redeemable in whole or in part at the election of the holders. The convertible promissory notes are general, unsecured obligations of the Company. In February and March 2024, Company entered into Exchange Agreements (the “Exchange Notes”) with certain convertible notes holders pursuant to which it agreed to issue total of $ 11.1 million principal amount of convertible promissory notes of the company due one year from issuance of the Exchange Notes in exchange for the surrender for cancellation and satisfaction in full of a like principal amount of our outstanding convertible promissory notes due in 2024 . The surrendered notes bore interest at the annual rate of 2 %, payable semi-annually, and were convertible at the election of the holder into shares of the Company's common stock at the conversion rate of $ 0.13 per share. The Exchange Notes bear interest at the annual rate of 10 % and are convertible into shares of the Company’s common stock at an initial conversion rate of $ 0.13 per share, subject to decrease, but not increase, at the end of each three-month period from issuance to equal the VWAP (as defined) of the Company’s common stock and to adjustment in the event of a stock split, reverse stock split and similar events. The principal amount of and accrued interest on the Exchange Notes will be payable in two equal semi-annual installments. No additional consideration was paid in connection with the exchange. The convertible promissory notes are general, unsecured obligations of the Company. Management evaluated if the transaction qualified as troubled debt restructuring under ASC 470-60. Since the Company was experiencing financial difficulty and the effective borrowing rate on the restructured debt is less than the effective borrowing rate on the original debt, this transaction was accounted for a troubled debt restructuring. As a result, the Company recorded gain on restructured debt of $ 1.0 million in the condensed consolidated statements of operations. The conversion feature of the convertible promissory notes is separately accounted for at fair value as a derivative liability under guidance in ASC 815 that is remeasured at fair value on a recurring basis using Level 3 inputs, with any changes in the fair value of the conversion feature liability recorded in the condensed consolidated statements of operations. The following table sets forth the fair value of the conversion feature liability as of March 31, 2024 and December 31, 2023 (in thousands): Convertible promissory notes March 31, 2024 December 31, 2023 Balance, beginning of period $ 451 $ 3,248 Change in fair value included in the statement of operations 907 ( 2,797 ) Balance, end of period $ 1,358 $ 451 The fair value and any change in fair value of conversion feature liability are determined using a binominal lattice model. The model produces an estimated fair value based on changes in the price of the underlying common stock. The fair value as of March 31, 2024 and December 31, 2023 was based upon following assumptions: Convertible promissory notes March 31, 2024 December 31, 2023 Stock price $ 0.11 $ 0.10 Conversion price $ 0.13 $ 0.13 Selected yield 27.28 % 27.23 % Expected volatility 50 % 50 % Time until maturity (in years) 0.90 0.16 Dividend yield — — Risk-free rate 5.10 % 5.51 % In July 2022, Dr. Niihara and his wife loaned the Company $ 370,000 , representing the net proceeds of personal loans to them from unaffiliated parties in the principal amount of $ 402,000 . The loan is due and payable in a lump sum on maturity on July 31, 2027 and bears interest at the rate of 12 % per annum, payable monthly in arrears. In connection with the loan, the Company granted Dr. Niihara a warrant as described in Note 8. The issuance cost of $ 32,000 and the fair value of warrant of $ 84,000 were treated as debt discount and will be amortized over the five-year term of the warrant using effective interest method. In August 2022, Dr. Niihara and his wife loaned the Company $ 1,576,574 , representing the net proceeds of personal loans to them from unaffiliated third parties in the principal amount of $ 1,668,751 , as well as $ 250,000 from personal funds. The loans are evidenced by promissory notes, which are due and payable in a lump sum on maturity on August 16, 2027 and bear interest at the rate of 10 % per annum, payable monthly in arrears. The foregoing loans were in addition to a $ 50,000 loan to the Company from Hope International Hospice, Inc., an affiliate of Dr. and Mrs. Niihara, on August 15, 2022, which is evidenced by a demand promissory note of the Company bearing interest at the rate of 10 % per annum. The proceeds of the loans were used to prepay $ 1,924,819 indebtedness of the Company under the Business Loan and Security Agreement. In December 2022, the Company entered into an Agreement for the Purchase and Sales of Future Receipts with a third party pursuant to which it sells $ 3,105,000 of future receipts (the "Purchased Amount") in exchange for net proceeds of $ 2,300,000 . Under the agreement, the Company agrees to pay $ 103,500 on a semi-monthly basis until the Purchased Amount is delivered. The portion of proceeds were used to prepay indebtedness of the Company under the Standard Merchant Cash Advance Agreements referred to above. In September 2023, the Company repaid in full the outstanding balance of the loan and recognized debt extinguishment loss of $ 312,000 as the Company entered into another agreement discussed below. In March 2023, Dr. Niihara and his wife and Hope International Hospice, Inc. , their affiliated company, loaned the Company $ 127,000 and $ 100,000 , respectively. Both loans are due on demand and bear interest at the rate of 10 % per annum. In March 2023, Emmaus Medical entered into Revenue Purchase Agreement with a third party pursuant to which it sold and assigned $ 700,212 of future receipts (the "Future Receipts") in exchange for net cash proceeds of $ 491,933 . Under the agreement, the Company agreed to pay the third party 4 % of weekly sales receipts until the Future Receipts have been collected. In July 2023, Emmaus Medical reentered into a new Revenue Purchase Agreement pursuant to which it sold and assigned $ 828,000 of future receipt in exchange for repayment of $ 204,000 indebtedness from the previous agreement and net cash proceeds of approximately $ 300,000 . Under the new agreement, the Company agreed to pay the third party approximately $ 26,000 weekly until the Future Receipts have been collected. The Company recognized debt extinguishment loss of $ 81,000 . In February 2024, the Company repaid the balance under the new Revenue Purchase Agreement. In March 2023, Emmaus Medical entered into Revenue Based Financing Agreement with a third party pursuant to which it sold and assigned $ 700,212 of future receipt in exchange for net proceeds of $ 492,132 . Under the agreement, the Company agreed to pay the third party approximately $ 22,000 weekly until the Future Receipts have been collected. In July 2023, Emmaus Medical reentered into a new Revenue Based Financing Agreement pursuant to which it sold and assigned $ 828,000 of future receipt in exchange for repayment of $ 222,000 indebtedness under the previous agreement and net cash proceeds of approximately $ 276,000 . Under the new agreement, the Company agreed to pay the third party approximately $ 26,000 weekly until the Future Receipts have been collected. The Company recognized debt extinguishment loss of $ 87,000 . In March 2024, the Company repaid the balance under the new Revenue Based Financing Agreement. In May 2023, Emmaus Medical entered into Sale of Future Receipts Agreement with third party pursuant to which it sold and assigned $ 528,200 of future receipts (the "Purchased Amount") in exchange for net cash proceeds of $ 368,600 . Under the agreement, the Company agreed to pay the third party approximately $ 19,000 weekly until the Purchased Amount has been collected. In September 2023, the Company repaid in full the outstanding balance of the loan and recognized debt extinguishment loss of $ 43,000 as the Company entered into another agreement discussed below. In June 2023, Emmaus Medical entered into Standard Merchant Cash Advance Agreement with a third party pursuant to which it sold and assigned $ 877,560 of future receipts (the "Purchased Amount") in exchange for net cash proceeds of $ 600,000 . Under the agreement, the Company agreed to pay the third party approximately $ 34,000 weekly until the Purchased Amount has been collected. In September 2023, the Company repaid in full the outstanding balance of the loan and recognized debt extinguishment loss of $ 124,000 as the Company entered into another agreement discussed below. In September 2023, the Company entered into a Business Loan and Security Agreement with a third-party lender pursuant to which the lender loaned the Company $ 2.2 million, of which the Company received net proceeds of approximately $ 2.1 million after deduction of the lender’s origination fee but without deduction for other transaction expenses. The portion of proceeds were used to prepay indebtedness of the company under t he Agreement for the Purchase and Sales of Future Receipts, the Sales of Future Receipt Agreement, Standard Merchant Cash Advance Agreement referred to above. In September 2023, Smart Start Investments Limited, of which Wei Pei Zen, a director of the Company, is a director and 9.96 % shareholder, loaned the Company the principal amount of $ 1 million in exchange for a convertible promissory note of the Company. The convertible promissory note is due on September 5, 2024 , bears interest at the annual rate of 10 %, payable at maturity, and is convertible at the option of the holder into shares of the Company's common stock at a conversion rate of $ 0.29 a share, subject to adjustment in the event of a stock split, reverse stock split or similar event. On March 5, 2024, the conversion feature of the convertible promissory note no longer met the scope exception in ASC 815-10-15-70(a) as the investors' Rule 144(d) holding period for the Company has ended and separately accounted for at fair value as a derivative liability that is remeasured at fair value on a recurring basis using Level 3 inputs, with any changes in fair value of the conversion feature liability recorded in the condensed consolidated statements of operations. As of March 5, 2024 and March 31, 2024, the fair value of the conversion feature was $ 2,000 . The fair value of conversion feature liability is determined using a convertible bond lattice model. The model produces an estimated fair value based on changes in the price of the underlying common stock over successive period of time. The following table presents the assumptions used to value the conversion features: Smart Start Convertible Note March 31, 2024 March 5, 2024 Stock price $ 0.11 $ 0.10 Conversion price $ 0.29 $ 0.29 Selected yield 28.20 % 25.75 % Expected volatility 50 % 50 % Time until maturity (in years) 0.43 0.50 Dividend yield — — Risk-free rate 5.40 % 5.35 % In October 2023, Emmaus Medical entered into Purchase and Sale of Future Receivables Agreement with a third party pursuant to which it sold and assigned $ 1,377,500 of future receipt (the "Purchased Amount") in exchange for net cash proceeds of $ 875,000 . Under the agreement, the Company agreed to pay the third party approximately $ 81,000 weekly until the Purchase Amount has collected. In February 2024, the Company repaid the balance under the Purchase and Sale of Future Receivables Agreement. In November 2023, Emmaus Medical entered into Agreement for the Purchase and Sale of Future Receipts with a third party pursuant to which it sold and assigned $ 762,200 of future receipts (the "Purchase Amount") in exchange for net cash proceeds of $ 468,650 . Under the agreement, the Company agreed to pay the third party approximately $ 49,000 weekly until the Purchase Amount has been collected. In March 2024, the Company repaid the balance under the Agreement for the Purchase and Sale of Future Receipts Agreement. In December 2023, Wei Peu Zen, a director of the Company loaned the Company $ 700,000 . The loan was due in two months and bears interest at the rate of 5 % per month. In February 2024, the Company repaid $ 350,000 in principal plus accrued interest on the loan. Beginning in February 2024 two related holders of demand promissory notes of the Company in the aggregate principal amount of approximately $ 2.8 million demanded repayment of the notes plus accrued interest. The Company has acknowledged its indebtedness to the holders and intends to seek to enter into a plan to repay the notes in installments. To date, the parties have not reached an agreement with respect to repayment of the notes. In March 2024, Smart Start Investments Limited, of which Wei Peu Zen, a director of the Company, is a director and 9.96 % shareholder, loaned the Company the principal amount of $ 1,400,000 . The loan was due in two months and bears interest at the rate of 2.5 % per month. As of May 2024, the loan became due on demand. Except as otherwise indicated above, the net proceeds of the foregoing loans and other arrangements were used to augment the Company's working capital. |
STOCKHOLDERS' DEFICIT
STOCKHOLDERS' DEFICIT | 3 Months Ended |
Mar. 31, 2024 | |
Stockholders Equity Note [Abstract] | |
STOCKHOLDERS' DEFICIT | NOTE 8 — STOCKHOLDERS’ DEFICIT Warrants — In September 2022, in connection with the loans from Dr. Niihara and Mrs. Niihara, the Company granted Dr. Niihara a five-year warrant to purchase up to 500,000 shares of common stock of the Company at an exercise price of $ 2.50 per share. Under ASC 480-10 and ASC 815, the warrant is classified as a liability. The fair value of the warrant liability was determined using Black-Scholes Merton model and the fair value of the warrant was $ 85,000 as of March 31, 2023 . The change in fair value was recorded in the condensed consolidated statements of operations. For three months ended March 31, 2023, the change in fair value of warrant liability was ($ 14,000 ). The warrant expired by its terms in November 2023 Warrant issued for services - - On January 12, 2023, the Company granted Dr. Niihara a five-year warrant to purchase up to 7,500,000 shares of common stock of the Company at an exercise price of $ 4.50 in lieu of cash bonuses or salary increases. The fair value of the warrant was determined using the Black-Scholes Merton option pricing model. The fair value of the underlying shares was determined based on the market value of the Company's common stock. The expected volatility was adjusted using the historical volatility of the Company's common stock and a comparative publicly traded securities. For the three month ended March 31, 2023, the Company recognized $ 1.2 million of shared-based compensation. Under ASC 480-10 and ASC 815, the warrants are classified as a liability. For the three month ended March 31, 2023, the Company recorded the change in fair value of approximately ($ 18,000 ) in the consolidated statements of operations. The warrant expired by its terms in November 2023 . On January 12, 2023, the Company granted two consultants to the Company five-year warrants to purchase up to 250,000 shares of common stock each at the exercise price of $ 0.50 a share. On January 27, 2023, the Company also granted a consulting company a five-year warrant to purchase up to 500,000 shares of common stock at an exercise price of $ 0.47 a share. The warrants are subject to adjustment in the event of a stock split, reverse stock split and similar events. The fair value of the warrants was determined using the Black-Scholes Merton option pricing model. The fair value of the underlying shares was determined based upon the market value of the common stock. The expected volatility was adjusted using the historical volatility of the common stock and the market price of comparable public traded securities. The estimated fair value of $ 334,000 was recorded as professional services in general and administrative expenses in the consolidated statement of operations when the warrants were granted. Under ASC 480-10 and ASC 815, the warrants are classified as a liability. For the three months ended March 31, 2024 and 2023, the Company recorded the change in fair value of approximately ($ 8,000 ) and $ 94,000 , respectively, in the consolidated statements of operations. The following table presents the assumptions used to value the warrants: March 31, 2024 December 31, 2023 March 31, 2023 January 2023 Stock price $ 0.11 $ 0.10 $ 0.30 $ 0.31 - $ 0.49 Exercise price $ 0.47 - $ 0.50 $ 0.47 - $ 0.50 $ 0.47 - $ 4.50 $ 0.47 - $ 4.50 Expected term 3.78 - 3.82 years 4.03 - 4.24 years 4.78 - 4.83 years 5 years Risk-free rate 4.32 %- 4.33 % 3.90 %- 3.92 % 3.62 % 3.53 %- 3.66 % Dividend yield — — — — Volatility 142.88 % - 143.59 % 129.40 %- 130.23 % 122.09 % - 122.53 % 116.40 % - 119.14 % A summary of outstanding warrants as of March 31, 2024 and December 31, 2023 is presented below: March 31, 2024 December 31, 2023 Number of Weighted‑ Number of Weighted‑ Warrants outstanding, beginning of period 4,732,391 $ 0.95 6,610,520 $ 2.22 Granted — — 8,500,000 4.03 Exercised — — — — Cancelled, forfeited or expired — — ( 10,378,129 ) 4.23 Warrants outstanding, end of period 4,732,391 $ 0.95 4,732,391 $ 0.95 Warrants exercisable end of period 4,732,391 $ 0.95 4,732,391 $ 0.95 As of March 31, 2024 , the weighted-average remaining contractual life of outstanding warrants was 1.9 years. Stock options — The Company's former 2011 Stock Incentive Plan permitted grants of incentive stock options to employees, including executive officers, and other share-based awards such as stock appreciation rights, restricted stock, stock units, stock bonus and unrestricted stock awards to employees, directors, and consultants for up to 9,000,000 shares of common stock. Options granted under the 2011 Stock Incentive Plan generally expire ten years after grant. Options granted to directors vest in quarterly installments and all other option grants vest over a minimum period of three years , in each case, subject to continuous service with the Company. The 2011 Stock Incentive Plan expired in May 2021 and no further awards may be made under the Plan. As of March 31, 2024 and December 31, 2023, stock options to purchase up to 1,476,443 , and 1,728,773 shares, respectively were outstanding under the 2011 Stock Incentive Plan. The Company also formerly had an Amended and Restated 2012 Omnibus Incentive Compensation Plan under which the Company could grant incentive stock options and non-qualified stock option to selected employees including officers, non-employee consultants and non-employee directors. The Plan was terminated in September 2021. As of March 31, 2024 and December 31, 2023, stock options to purchase up to 245,108 shares were outstanding under the Amended and Restated 2012 Omnibus Incentive Plan. On September 29, 2021, the Board of Directors of the Company adopted the Emmaus Life Sciences, Inc. 2021 Stock Incentive Plan upon the recommendation of the Compensation Committee of the Board. The 2021 Stock Incentive Plan was approved by stockholders on November 23, 2021. No more than 4,000,000 shares of common stock may be issued pursuant to awards under the 2021 Stock Incentive Plan. The number of shares available for Awards, as well as the terms of outstanding awards, is subject to adjustment as provided in the 2021 Stock Incentive Plan for stock splits, stock dividends, reverse stock splits, recapitalizations and other similar events. During the three months ended March 31, 2024, the Company granted options to purchase 1,620,000 shares, 300,000 shares and 440,000 shares of common stock to employees, non-employee directors and consultants, respectively . All options are exercisable for ten years from the date of grant and will vest and become exercisable with respect to the underlying shares over three years for employees, one year for non-employee directors and immediately for the consultant. As of March 31, 2024 and December 31, 2023, stock options to purchase up to 3,610,000 and 1,250,000 shares, respectively, were outstanding under the 2021 Stock Incentive Plan. Management has valued stock options at their date of grant utilizing the Black-Scholes-Merton Option pricing model. The fair value of the underlying shares was determined by the market value of the Company's common stock. The expected volatility was adjusted using the historical volatility of the common stock and a comparable public traded securities. The following table presents the assumptions used on the recent dates on which options were granted by the Company. The risk‑free interest rate is based on the implied yield available on U.S. Treasury issues with a term approximating the expected life of the options depending on the date of the grant and expected life of the respective options. January 2024 January 2023 Stock Price $ 0.11 $ 0.31 Exercise Price $ 0.15 $ 4.50 Expected term 5 - 5.75 years 5 - 6 years Risk-Free Rate 3.80 - 3.81 % 3.51 - 3.53 % Dividend Yield — — Volatility 127.39 - 136.00 % 108.16 - 116.40 % A summary of outstanding stock options as of March 31, 2024 and December 31, 2023 is presented below: March 31, 2024 December 31, 2023 Number of Weighted‑ Number of Weighted‑ Options outstanding, beginning of period 3,223,881 $ 5.97 4,660,787 $ 5.08 Granted or deemed granted 2,360,000 $ 0.15 1,250,000 $ 4.50 Exercised — $ — — $ — Cancelled, forfeited and expired ( 252,330 ) $ 3.20 ( 2,686,906 ) $ 3.74 Options outstanding, end of period 5,331,551 $ 3.52 3,223,881 $ 5.97 Options exercisable, end of period 4,350,051 $ 3.73 2,373,881 $ 6.50 Options available for future grant 360,000 2,750,000 During the three months ended March 31, 2024 and March 31, 2023 , the Company recognized approximately $ 170,000 and $ 38,000 , respectively of share-based compensation expense related to stock options. As of March 31, 2024 , there was approximately $ 204,000 of unrecognized share-based compensation expense related to unvested stock options which is expected to be recognized over the weighted-average remaining vesting period of 1.5 year. Amended and Restated Warrants – The Company evaluated its outstanding amended and restated warrants to purchase up to 2,375,000 shares of common stock under ASC 815-40 and concluded that the warrants should be accounted for as equity. In January 2023, the exercise price of outstanding amended and restated warrants was reduced to $ 0.37 per share pursuant to the anti-dilution adjustment provisions of the warrants triggered by the conversion of an outstanding convertible promissory note into shares of common stock of the Company at a conversion price $ 0.37 per share. The warrants were valued using the Black-Scholes Merton option pricing model and approximately $ 41,000 change in fair value was recorded as additional paid-in capital and reflected in accumulated deficit. |
INCOME TAX
INCOME TAX | 3 Months Ended |
Mar. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
INCOME TAX | NOTE 9 — INCOME TAX The quarterly provision for or benefit from income taxes is computed based upon the estimated annual effective tax rate and the year-to-date pre-tax income (loss) and other comprehensive income. For the three months ended March 31, 2024 and 2023, the Company recorded a state income tax benefit of $ 7,000 and provision of $ 49,000 , respectively. The Company did no t record a provision for federal income tax due to its net operating loss carryforwards. The Company established a full valuation allowance against its federal and state deferred tax assets and there was no unrecognized tax benefit as of March 31, 2024 or March 31, 2023. |
LEASES
LEASES | 3 Months Ended |
Mar. 31, 2024 | |
Leases [Abstract] | |
LEASES | NOTE 10 — LEASES Operating leases — The Company leases its office space under operating leases with unrelated entities. The Company leases 21,293 square feet of office space for its headquarters in Torrance, California, at a base rental of $ 87,514 per month, which lease will expire on September 30, 2026 . In addition, the Company leases 1,163 square feet of office space in Dubai, United Arab Emirates, which lease will expire on June 19, 2026 . The lease expense during the three months ended March 31, 2024 and 2023 was approximate ly $ 301,000 and $ 303,000 , respectively. Future minimum lease payments under the lease agreements were as follows as of March 31, 2024 (in thousands): Amount 2024 (nine months) $ 828 2025 1,132 2026 846 Total lease payments 2,806 Less: Interest 376 Present value of lease liabilities $ 2,430 As of March 31, 2024 , the Company had an operating lease right-of-use asset of $ 2.1 million and lease liability of $ 2.4 million reflected on the condensed consolidated balance sheet. The weighted average remaining term of the Company’s leases as of March 31, 2024 was 2.5 years and the weighted-average discount rate was 12.9 %. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2024 | |
Commitments And Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 11 — COMMITMENTS AND CONTINGENCIES API Supply Agreement — On June 12, 2017, the Company entered into an API Supply Agreement (the “API Agreement”) with Telcon pursuant to which Telcon paid the Company approximately $ 31.8 million in consideration of the right to supply 25 % of the Company’s requirements for bulk containers of PGLG for a fifteen-year term. The amount was recorded as deferred trade discount. On July 12, 2017, the Company entered into a raw material supply agreement with Telcon which revised certain terms of the API supply agreement (the “revised API agreement”). The revised API agreement is effective for a term of five years and will renew automatically for 10 successive one-year renewal periods, except as either party may determine. In the revised API agreement, the Company has agreed to purchase a cumulative total of $ 47.0 million of PGLG over the term of the agreement. The revised API agreement provided for an annual API purchase target of $ 5 million and a target “profit” ( i.e. , gross margin) to Telcon of $ 2.5 million. To the extent these targets are not met, Telcon may be entitled to payment of the shortfall or to offset the shortfall against the Telcon convertible bond and proceeds there of that are pledged as collateral to secure our obligations. In September 2018, the Company entered into an agreement with Ajinomoto Health and Nutrition North America, Inc. (“Ajinomoto”), the producer of the PGLG, and Telcon to facilitate Telcon’s purchase of PGLG from Ajinomoto for resale to the Company under the revised API agreement. The PGLG raw material purchased from Telcon is recorded in inventory at net realizable value and the excess purchase price is recorded against deferred trade discount. Refer to Notes 5 and 6 for more information. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2024 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 12 — RELATED PARTY TRANSACTIONS The following table sets forth information relating to loans from related parties outstanding at any time during the three months ended March 31, 2024 (in thousands): Class Lender Interest Date of Term of Loan Principal Amount Outstanding at March 31, 2024 Highest Amount of Amount of Promissory note payable to related parties: Willis Lee(2) 12 % 10/29/2020 Due on Demand 100 100 — — Soomi Niihara(1) 12 % 12/7/2021 Due on Demand 700 700 — — Hope International Hospice, Inc.(1) 10 % 2/9/2022 Due on Demand 350 350 — — Hope International Hospice, Inc.(1) 10 % 2/15/2022 Due on Demand 210 210 — — Soomi Niihara(1) 10 % 2/15/2022 Due on Demand 100 100 — — Hope International Hospice, Inc.(1) 12 % 3/15/2022 Due on Demand 150 150 — — Hope International Hospice, Inc.(1) 12 % 3/30/2022 Due on Demand 150 150 — — Wei Peu Derek Zen(2) 10 % 3/31/2022 Due on Demand 200 200 — — Willis Lee(2) 10 % 4/14/2022 Due on Demand 45 45 — — Hope International Hospice, Inc.(1) 10 % 5/25/2022 Due on Demand 40 40 — — Yutaka and Soomi Niihara(1) 12 % 7/27/2022 5 years 402 402 — 12 Yutaka and Soomi Niihara(1) 10 % 8/16/2022 5 years 250 250 — 6 Yutaka and Soomi Niihara(1) 10 % 8/16/2022 5 years 1,669 1,669 — 42 Hope International Hospice, Inc.(1) 10 % 8/17/2022 Due on Demand 50 50 — — Hope International Hospice, Inc.(1) 10 % 10/20/2022 Due on Demand 100 100 — — Hope International Hospice, Inc.(1) 10 % 3/17/2023 Due on Demand 100 100 — — Yutaka and Soomi Niihara(1) 10 % 3/21/2023 Due on Demand 127 127 — — Wei Peu Zen(2) 60 % 12/1/2023 2 months 350 700 350 70 Subtotal $ 5,093 $ 5,443 $ 350 $ 130 Total $ 5,093 $ 5,443 $ 350 $ 130 The following table sets forth information relating to loans from related parties outstanding at any time during the year ended December 31, 2023: Class Lender Interest Date of Term of Loan Principal Amount Outstanding at December 31, 2023 Highest Amount of Amount of Current, Promissory note payable to related parties: Willis C. Lee(2) 12 % 10/29/2020 Due on Demand 100 100 — — Soomi Niihara(1) 12 % 12/7/2021 Due on Demand 700 700 — — Hope International Hospice, Inc.(1) 12 % 2/9/2022 Due on Demand 350 350 — — Hope International Hospice, Inc.(1) 10 % 2/15/2022 Due on Demand 210 210 — — Soomi Niihara(1) 10 % 2/15/2022 Due on Demand 100 100 — — Hope International Hospice, Inc.(1) 10 % 3/15/2022 Due on Demand 150 150 — — Hope International Hospice, Inc.(1) 10 % 3/30/2022 Due on Demand 150 150 — — Wei Peu Zen(2) 10 % 3/31/2022 Due on Demand 200 200 — — Willis C. Lee(2) 10 % 4/14/2022 Due on Demand 45 45 — — Hope International Hospice, Inc.(1) 12 % 5/25/2022 Due on Demand 40 40 — — Yutaka and Soomi Niihara(1) 12 % 7/27/2022 5 years 402 402 — 48 Hope International Hospice, Inc.(1) 10 % 8/15/2022 Due on Demand — 50 50 2 Yutaka and Soomi Niihara(1) 10 % 8/16/2022 5 years 250 250 — 25 Yutaka and Soomi Niihara(1) 10 % 8/16/2022 5 years 1,669 1,669 — 167 Hope International Hospice, Inc.(1) 12 % 8/17/2022 Due on Demand 50 50 — — Yutaka and Soomi Niihara(1) 10 % 8/17/2022 Due on Demand — 60 60 6 Seah Lim(2) 10 % 9/16/2022 3 years — 1,200 1,200 90 Hope International Hospice, Inc.(1) 10 % 10/20/2022 Due on Demand 100 100 — — Hope International Hospice, Inc.(1) 10 % 3/17/2023 Due on Demand 100 100 — — Yutaka and Soomi Niihara(1) 10 % 3/21/2023 Due on Demand 127 127 — — Wei Peu Zen(2) 60 % 12/1/2023 2 months 700 700 — — Subtotal $ 5,443 $ 6,753 $ 1,310 $ 338 Convertible note payable to related parties: Wei Peu Zen(2) 10 % 1/18/2023 1 - 2 years — 1,000 1,000 91 Subtotal $ — $ 1,000 $ 1,000 $ 91 Total $ 5,443 $ 7,753 $ 2,310 $ 429 (1) Dr. Niihara, a former Director and former Chairman and Chief Executive Officer of the Company, is also a director and the Chief Executive Officer of Hope International Hospice, Inc. (2) Officer or director. See Note 7 for more information on recent developments with respect to certain related-party loans. See Notes 5, 6 and 11 for a discussion of the Company’s agreements with Telcon, which holds 4,147,491 shares of common stock of the Company, or approximately 6.7 % of the common stock outstanding as of March 31, 2024. As of March 31, 2024, the Company held a Telcon convertible bond in the principal amount of KRW 23.6 billion, or approximately $ 17.5 million as discussed in Note 5. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2024 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 13 — SUBSEQUENT EVENTS In April 2024, Telcon offset KRW 3.5 billion, or approximately $ 2.5 million, against the principal amount of the Telcon convertible bond and release of KRW 893 million, or approximately $ 640,000 , in cash proceeds to Telcon in satisfaction the target shortfall for the year ended 2023. In May 2024, Emmaus Medical entered into Sale of Future Receipts Agreement with third party pursuant to which it sold and assigned $ 1,628,000 of future receipts (the "Purchased Amount") in exchange for net cash proceeds of $ 1,001,000 . Under the agreement, the Company agreed to pay the third party approximately $ 58,143 weekly until the Purchased Amount has been collected. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Nature of Operations | Nature of Operations The Company is a commercial-stage biopharmaceutical company engaged in the discovery, development, marketing and sales of innovative treatments and therapies, primarily for rare and orphan diseases. The Company’s only product, Endari® (prescription grade L-glutamine oral powder), is approved by the U.S. Food and Drug Administration, or FDA, and in certain jurisdictions in the Middle East North Africa, or MENA, region to reduce the acute complications of sickle cell disease (“SCD”) in adult and pediatric patients five years of age and older. |
Going concern | Going concern — The accompanying unaudited condensed consolidated financial statements have been prepared on the basis that the Company will continue as a going concern. The Company incurred a net loss of $ 4.3 million for the three months ended March 31, 2024 and had a working capital deficit of $ 54.6 million as of March 31, 2024. Management expects that the Company’s current liabilities, operating losses and expected capital needs, including debt service on its existing indebtedness and the expected costs relating to the commercialization of Endari® in the MENA region and elsewhere will exceed its existing cash balances and cash expected to be generated from operations for the foreseeable future. To meet the Company’s current liabilities and future obligations, the Company will need to restructure or refinance its existing indebtedness and raise additional funds through related-party loans, third-party loans, equity or debt financings or licensing or other strategic agreements. Except as described below under "Factoring accounts receivable," the Company has no understanding or arrangement for any additional financing, and there can be no assurance that the Company will be able to restructure or refinancing its existing indebtedness or obtain additional related-party or third-party loans or complete any additional equity or debt financings on favorable terms, or at all, or enter into licensing or other strategic arrangements. Due to the uncertainty of the Company’s ability to meet its current liabilities and operating expenses, there is substantial doubt about the Company’s ability to continue as a going concern for 12 months from the date that these condensed consolidated financial statements are issued. The condensed consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties. |
Prior period misclassification | Prior period misclassification - During the quarter ended June 30, 2023, the Company identified a misclassification related to common stock warrants that were issued in January 2023. The common stock warrants were incorrectly recorded in additional paid-in capital at their estimated fair value of $ 1.5 million, but should have been recorded as warrant derivative liabilities, as they did not qualify for equity classification in accordance with ASC815-40-25-10. The correction of the misclassification in the condensed consolidated financial statements is reflected for the three months ended March 31, 2023. The Company believes the correction of the misclassification is quantitatively and qualitatively immaterial to the previously issued condensed consolidated financial statements. The condensed consolidated statements of changes in stockholders’ deficit included in this Quarterly Report differ from the previously filed Form 10-Q’s for period ended March 2023, reflecting the misclassification of $ 1.4 million as additional paid-in capital and warrant derivative liability for warrants issued in January 2023. |
Factoring accounts receivables | Factoring accounts receivable — Emmaus Medical, Inc., or Emmaus Medical, the Company's indirect wholly owned subsidiary, has entered into a purchase and sales agreement with Prestige Capital Finance, LLC or Prestige Capital, pursuant to which Emmaus Medical may offer and sell to Prestige Capital from time to time eligible accounts receivable in exchange for Prestige Capital’s down payment, or advance, to Emmaus Medical of 65 % to 80 % of the face amount of the eligible accounts receivable, subject to a $ 7.5 million cap on advances at any time. The balance of the face amount of the accounts receivable is reserved by Prestige Capital and paid to Emmaus Medical, less discount fees of Prestige Capital ranging from 2.25 % to 7.25 % of the face amount, as and when Prestige Capital collects the entire face amount of the accounts receivable. Emmaus Medical’s obligations to Prestige Capital under the purchase and sale agreement are secured by a security interest in the accounts receivable and all or substantially all other assets of Emmaus Medical. In connection with the purchase and sale agreement, Emmaus has guaranteed Emmaus Medical’s obligations under the purchase and sale agreement. Accounts receivable included approximately $ 40,000 and $ 1,514,000 of factored accounts receivable and other current liabilities included approximately $ 1,000 and $ 24,000 of liabilities from factoring at March 31, 2024 and December 31, 2023, respectively. For the three months ended March 31, 2024 and 2023 , the Company incurred approximately $ 87,000 and $ 108,000 , respectively, of factoring fees. |
Net loss per share | Net loss per share — In accordance with Accounting Standard Codification (“ASC”) 260, “Earnings per Share, ” the basic net loss per common share is computed by dividing net loss available to common stockholders by the weighted-average number of common shares outstanding. Diluted net loss per share is computed in a similar manner, except that the denominator is increased to include the number of additional shares of common stock that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. As of March 31, 2024 and March 31, 2023, the Company had outstanding potentially dilutive securities exercisable for or convertible into 112,942,491 shares and 61,174,436 shares, respectively, of common stock. No potentially dilutive securities were included in the calculation of diluted net loss per share, since the effect would have been anti-dilutive for the each of the three months ended March 31, 2024 and March 31, 2023 . |
REVENUES (Tables)
REVENUES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Revenue From Contract With Customer [Abstract] | |
Summary of revenues disaggregated by category | Revenues disaggregated by category were as follows (in thousands): Three months ended March 31, 2024 2023 Endari® $ 2,344 $ 6,515 Other 162 238 Revenues, net $ 2,506 $ 6,753 |
Revenue Allowance and Accrual Activities | The following table summarizes the revenue allowance and accrual activities for the three months ended March 31, 2024 and March 31, 2023 (in thousands): Trade Discounts, Allowances and Chargebacks Government Rebates and Other Incentives Returns Total Balance as of December 31, 2023 $ 1,212 $ 5,658 $ 863 $ 7,733 Provision related to sales in the current year 205 577 25 807 Adjustments related to prior period sales ( 50 ) 51 — 1 Credits and payments made ( 529 ) ( 553 ) ( 645 ) ( 1,727 ) Balance as of March 31, 2024 $ 838 $ 5,733 $ 243 $ 6,814 Balance as of December 31, 2022 $ 1,358 $ 3,718 $ 415 $ 5,491 Provision related to sales in the current year 425 819 106 1,350 Adjustments related to prior period sales ( 213 ) 130 — ( 83 ) Credits and payments made ( 716 ) ( 597 ) ( 150 ) ( 1,463 ) Balance as of March 31, 2023 $ 854 $ 4,070 $ 371 $ 5,295 |
Summarizes revenues from each of our customers accounted for 10% or more of net revenues | The following table summarizes revenues attributable to each of our customers that accounted for 10% or more of our net revenues in any of the periods shown: Three months ended March 31, 2024 2023 Customer A 46 % 20 % Customer B 39 % 15 % Customer D 2 % 16 % Customer F 1 % 23 % |
SELECTED FINANCIAL STATEMENT _2
SELECTED FINANCIAL STATEMENT - ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Balance Sheet Related Disclosures [Abstract] | |
Schedule of inventory | Inventories consisted of the following (in thousands): March 31, 2024 December 31, 2023 Raw materials and components $ 1,313 $ 1,329 Work-in-process 200 186 Finished goods 4,993 5,163 Inventory reserve ( 4,979 ) ( 4,967 ) Total inventories, net $ 1,527 $ 1,711 |
Schedule of prepaid expenses and other current assets | Prepaid expenses and other current assets consisted of the following (in thousands): March 31, 2024 December 31, 2023 Prepaid insurance $ 411 $ 595 Prepaid expenses 442 536 Other current assets 762 596 Total prepaid expenses and other current assets $ 1,615 $ 1,727 |
Schedule of property and equipment | Property and equipment consisted of the following (in thousands): March 31, 2024 December 31, 2023 Equipment $ 384 $ 383 Leasehold improvements 39 39 Furniture and fixtures 99 99 Total property and equipment 522 521 Less: accumulated depreciation ( 465 ) ( 462 ) Total property and equipment, net $ 57 $ 59 |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Investments [Abstract] | |
Schedule of Fair Value and Changes in Fair Value of Investment in Convertible Bonds | The following table sets forth the fair value and changes in fair value of the investment in the Telcon convertible bond as of March 31, 2024 and December 31, 2023 (in thousands): Investment in convertible bond March 31, 2024 December 31, 2023 Balance, beginning of period $ 20,978 $ 19,971 Sales of convertible bond — ( 2,232 ) Net gain on investment on convertible bond — 106 Change in fair value included in the statement of other comprehensive income ( 1,728 ) 3,133 Balance, end of period $ 19,250 $ 20,978 |
Schedule of Fair Value Based upon Assumptions | The fair value as of March 31, 2024 and December 31, 2023 was based upon following assumptions: March 31, 2024 December 31, 2023 Principal outstanding (South Korean won) KRW 23.6 billion KRW 23.6 billion Stock price KRW 804 KRW 873 Expected life (in years) 6.54 6.79 Selected yield 12.75 % 12.25 % Expected volatility (Telcon common stock) 71.10 % 71.90 % Risk-free interest rate (South Korea government bond) 3.37 % 3.16 % Expected dividend yield — — Conversion price KRW 705 (US$ 0.53 ) KRW 705 (US$ 0.54 ) |
SELECTED FINANCIAL STATEMENT _3
SELECTED FINANCIAL STATEMENT - LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Payables And Accruals [Abstract] | |
Schedule of accounts payable and accrued expenses | Accounts payable and accrued expenses consisted of the following at March 31, 2024 and December 31, 2023 (in thousands): March 31, 2024 December 31, 2023 Accounts payable: Clinical and regulatory expenses $ 670 $ 696 Professional fees 861 721 Selling expenses 1,807 1,498 Manufacturing costs 891 914 Non-employee director compensation 839 766 Other vendors 1,497 1,292 Total accounts payable 6,565 5,887 Accrued interest payable, related parties 587 542 Accrued interest payable 2,516 3,122 Accrued expenses: Payroll expenses 1,251 1,270 Government rebates and other rebates 7,181 5,881 Due to customers — 844 Other accrued expenses 87 179 Total accrued expenses 8,519 8,174 Total accounts payable and accrued expenses $ 18,187 17,725 |
Schedule of other current liabilities | Other current liabilities consisted of the following at March 31, 2024 and December 31, 2023 (in thousands): March 31, 2024 December 31, 2023 Trade discount $ 3,500 $ 3,000 Unearned revenue (a) 10,000 10,000 Other current liabilities 1,358 1,681 Total other current liabilities $ 14,858 $ 14,681 (a) Refer to Note 3 for information regarding to the unearned revenue. |
Schedule of other long-term liabilities | Other long-term liabilities consisted of the following at March 31, 2024 and December 31, 2023 (in thousands): March 31, 2024 December 31, 2023 Trade discount $ 16,928 $ 17,324 Other long-term liabilities 39 39 Total other long-term liabilities $ 16,967 $ 17,363 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Schedule of notes payable | Notes payable consisted of the following at March 31, 2024 and December 31, 2023 (in thousands except for number of underlying shares): Year Interest Rate Term of Notes Conversion Principal Unamortized Discount March 31, 2024 Carrying Underlying Shares March 31, 2024 Notes payable 2013 10 % Due on demand — $ 661 $ — $ 661 — 2022 10 %- 12 % Due on demand — 1,264 — 1,264 — 2023 11 %- 40 % Due on demand - 32 weeks — 4,428 33 4,395 — 2024 30 % 2 month — 1,400 — 1,400 — $ 7,753 $ 33 $ 7,720 — Current $ 7,753 $ 33 $ 7,720 — Notes payable - related parties 2020 12 % Due on demand — 100 — 100 — 2021 12 % Due on demand — 700 — 700 — 2022 10 %- 12 % Due on demand - 5 years — 3,716 90 3,626 — 2023 10 %- 60 % Due on demand - 2 month — 577 — 577 $ 5,093 $ 90 $ 5,003 — Current $ 2,772 $ — $ 2,772 — Non-current $ 2,321 $ 90 $ 2,231 — Convertible notes payable 2021 10 % Due on demand $ 0.13 (b) 1,380 — 1,380 12,605,099 2023 12 % 6 months $ 10.00 (a) 3,150 — 3,150 347,535 2023 10 % 1 year $ 0.29 1,000 2 998 3,645,725 2024 10 % 1 year $ 0.13 11,060 — 11,060 86,627,725 $ 16,590 $ 2 $ 16,588 103,226,084 Current $ 16,590 $ 2 $ 16,588 103,226,084 Total $ 29,436 $ 125 $ 29,311 103,226,084 Year Interest Rate Term of Notes Conversion Principal Unamortized Carrying Underlying Shares Notes payable 2013 10 % Due on demand — $ 709 $ — $ 709 — 2022 10 % - 12 % Due on demand — 1,284 — 1,284 — 2023 10 % - 57 % Due on demand - 56 months — 6,337 115 $ 6,222 — $ 8,330 $ 115 $ 8,215 — Current $ 8,330 $ 115 $ 8,215 — Notes payable - related parties 2020 12 % Due on demand — 100 — 100 — 2021 12 % Due on demand — 700 — 700 — 2022 6 %- 12 % Due on demand - 5 years — 3,716 95 3,621 — 2023 10 %- 60 % Due on demand - 2 months — 927 — 927 $ 5,443 $ 95 $ 5,348 — Current $ 3,122 $ — $ 3,122 — Non-current $ 2,321 $ 95 $ 2,226 — Convertible notes payable 2021 2 % 3 years $ 0.13 12,640 407 12,233 113,009,154 2023 13 % Due on demand $ 10.00 (a) 3,150 — 3,150 337,326 2023 10 % 1 year $ 0.29 1,000 — 1,000 3,559,754 $ 16,790 $ 407 $ 16,383 $ 116,906,234 Current $ 16,790 $ 407 $ 16,383 $ 116,906,234 Total $ 30,563 $ 617 $ 29,946 $ 116,906,234 (a) This note is convertible into shares of EMI Holding, Inc., a wholly owned subsidiary of Emmaus Life Sciences, Inc . (b) The stated interest for the notes was 2 %. As the loan is default as of March 31, 2024, the default interest rate is applicable. |
Schedule of future contractual principal payments of notes payable | As of March 31, 2024, future contractual principal payments due on notes payable were as follows (in thousands): Year Ending 2024 (nine months) $ 27,115 2025 — 2026 — 2027 2,321 Total $ 29,436 |
Schedule of fair value of conversion feature liabilities | The following table presents the assumptions used on the recent dates on which options were granted by the Company. The risk‑free interest rate is based on the implied yield available on U.S. Treasury issues with a term approximating the expected life of the options depending on the date of the grant and expected life of the respective options. January 2024 January 2023 Stock Price $ 0.11 $ 0.31 Exercise Price $ 0.15 $ 4.50 Expected term 5 - 5.75 years 5 - 6 years Risk-Free Rate 3.80 - 3.81 % 3.51 - 3.53 % Dividend Yield — — Volatility 127.39 - 136.00 % 108.16 - 116.40 % |
Schedule of Fair Value Based upon Assumptions | The fair value as of March 31, 2024 and December 31, 2023 was based upon following assumptions: March 31, 2024 December 31, 2023 Principal outstanding (South Korean won) KRW 23.6 billion KRW 23.6 billion Stock price KRW 804 KRW 873 Expected life (in years) 6.54 6.79 Selected yield 12.75 % 12.25 % Expected volatility (Telcon common stock) 71.10 % 71.90 % Risk-free interest rate (South Korea government bond) 3.37 % 3.16 % Expected dividend yield — — Conversion price KRW 705 (US$ 0.53 ) KRW 705 (US$ 0.54 ) |
Conversion Feature Liabilities [Member] | Convertible Promissory Notes [Member] | |
Schedule of Fair Value Based upon Assumptions | The fair value as of March 31, 2024 and December 31, 2023 was based upon following assumptions: Convertible promissory notes March 31, 2024 December 31, 2023 Stock price $ 0.11 $ 0.10 Conversion price $ 0.13 $ 0.13 Selected yield 27.28 % 27.23 % Expected volatility 50 % 50 % Time until maturity (in years) 0.90 0.16 Dividend yield — — Risk-free rate 5.10 % 5.51 % |
Conversion Feature Liabilities [Member] | Smart Start Convertible Note [Member] | |
Schedule of Fair Value Based upon Assumptions | The fair value of conversion feature liability is determined using a convertible bond lattice model. The model produces an estimated fair value based on changes in the price of the underlying common stock over successive period of time. The following table presents the assumptions used to value the conversion features: Smart Start Convertible Note March 31, 2024 March 5, 2024 Stock price $ 0.11 $ 0.10 Conversion price $ 0.29 $ 0.29 Selected yield 28.20 % 25.75 % Expected volatility 50 % 50 % Time until maturity (in years) 0.43 0.50 Dividend yield — — Risk-free rate 5.40 % 5.35 % |
Level 3 [Member] | Conversion Feature Liabilities [Member] | |
Schedule of fair value of conversion feature liabilities | The following table sets forth the fair value of the conversion feature liability as of March 31, 2024 and December 31, 2023 (in thousands): Convertible promissory notes March 31, 2024 December 31, 2023 Balance, beginning of period $ 451 $ 3,248 Change in fair value included in the statement of operations 907 ( 2,797 ) Balance, end of period $ 1,358 $ 451 |
STOCKHOLDERS' DEFICIT (Tables)
STOCKHOLDERS' DEFICIT (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Stockholders Equity Note [Abstract] | |
Summary of assumptions used to value the warrants | The following table presents the assumptions used to value the warrants: March 31, 2024 December 31, 2023 March 31, 2023 January 2023 Stock price $ 0.11 $ 0.10 $ 0.30 $ 0.31 - $ 0.49 Exercise price $ 0.47 - $ 0.50 $ 0.47 - $ 0.50 $ 0.47 - $ 4.50 $ 0.47 - $ 4.50 Expected term 3.78 - 3.82 years 4.03 - 4.24 years 4.78 - 4.83 years 5 years Risk-free rate 4.32 %- 4.33 % 3.90 %- 3.92 % 3.62 % 3.53 %- 3.66 % Dividend yield — — — — Volatility 142.88 % - 143.59 % 129.40 %- 130.23 % 122.09 % - 122.53 % 116.40 % - 119.14 % |
Summary of outstanding warrants | A summary of outstanding warrants as of March 31, 2024 and December 31, 2023 is presented below: March 31, 2024 December 31, 2023 Number of Weighted‑ Number of Weighted‑ Warrants outstanding, beginning of period 4,732,391 $ 0.95 6,610,520 $ 2.22 Granted — — 8,500,000 4.03 Exercised — — — — Cancelled, forfeited or expired — — ( 10,378,129 ) 4.23 Warrants outstanding, end of period 4,732,391 $ 0.95 4,732,391 $ 0.95 Warrants exercisable end of period 4,732,391 $ 0.95 4,732,391 $ 0.95 |
Schedule of fair value of conversion feature liabilities | The following table presents the assumptions used on the recent dates on which options were granted by the Company. The risk‑free interest rate is based on the implied yield available on U.S. Treasury issues with a term approximating the expected life of the options depending on the date of the grant and expected life of the respective options. January 2024 January 2023 Stock Price $ 0.11 $ 0.31 Exercise Price $ 0.15 $ 4.50 Expected term 5 - 5.75 years 5 - 6 years Risk-Free Rate 3.80 - 3.81 % 3.51 - 3.53 % Dividend Yield — — Volatility 127.39 - 136.00 % 108.16 - 116.40 % |
Summary of stock option activity | A summary of outstanding stock options as of March 31, 2024 and December 31, 2023 is presented below: March 31, 2024 December 31, 2023 Number of Weighted‑ Number of Weighted‑ Options outstanding, beginning of period 3,223,881 $ 5.97 4,660,787 $ 5.08 Granted or deemed granted 2,360,000 $ 0.15 1,250,000 $ 4.50 Exercised — $ — — $ — Cancelled, forfeited and expired ( 252,330 ) $ 3.20 ( 2,686,906 ) $ 3.74 Options outstanding, end of period 5,331,551 $ 3.52 3,223,881 $ 5.97 Options exercisable, end of period 4,350,051 $ 3.73 2,373,881 $ 6.50 Options available for future grant 360,000 2,750,000 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Leases [Abstract] | |
Schedule of future minimum lease payments | Future minimum lease payments under the lease agreements were as follows as of March 31, 2024 (in thousands): Amount 2024 (nine months) $ 828 2025 1,132 2026 846 Total lease payments 2,806 Less: Interest 376 Present value of lease liabilities $ 2,430 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Related Party Transactions [Abstract] | |
Schedule of outstanding loans from related parties | The following table sets forth information relating to loans from related parties outstanding at any time during the three months ended March 31, 2024 (in thousands): Class Lender Interest Date of Term of Loan Principal Amount Outstanding at March 31, 2024 Highest Amount of Amount of Promissory note payable to related parties: Willis Lee(2) 12 % 10/29/2020 Due on Demand 100 100 — — Soomi Niihara(1) 12 % 12/7/2021 Due on Demand 700 700 — — Hope International Hospice, Inc.(1) 10 % 2/9/2022 Due on Demand 350 350 — — Hope International Hospice, Inc.(1) 10 % 2/15/2022 Due on Demand 210 210 — — Soomi Niihara(1) 10 % 2/15/2022 Due on Demand 100 100 — — Hope International Hospice, Inc.(1) 12 % 3/15/2022 Due on Demand 150 150 — — Hope International Hospice, Inc.(1) 12 % 3/30/2022 Due on Demand 150 150 — — Wei Peu Derek Zen(2) 10 % 3/31/2022 Due on Demand 200 200 — — Willis Lee(2) 10 % 4/14/2022 Due on Demand 45 45 — — Hope International Hospice, Inc.(1) 10 % 5/25/2022 Due on Demand 40 40 — — Yutaka and Soomi Niihara(1) 12 % 7/27/2022 5 years 402 402 — 12 Yutaka and Soomi Niihara(1) 10 % 8/16/2022 5 years 250 250 — 6 Yutaka and Soomi Niihara(1) 10 % 8/16/2022 5 years 1,669 1,669 — 42 Hope International Hospice, Inc.(1) 10 % 8/17/2022 Due on Demand 50 50 — — Hope International Hospice, Inc.(1) 10 % 10/20/2022 Due on Demand 100 100 — — Hope International Hospice, Inc.(1) 10 % 3/17/2023 Due on Demand 100 100 — — Yutaka and Soomi Niihara(1) 10 % 3/21/2023 Due on Demand 127 127 — — Wei Peu Zen(2) 60 % 12/1/2023 2 months 350 700 350 70 Subtotal $ 5,093 $ 5,443 $ 350 $ 130 Total $ 5,093 $ 5,443 $ 350 $ 130 The following table sets forth information relating to loans from related parties outstanding at any time during the year ended December 31, 2023: Class Lender Interest Date of Term of Loan Principal Amount Outstanding at December 31, 2023 Highest Amount of Amount of Current, Promissory note payable to related parties: Willis C. Lee(2) 12 % 10/29/2020 Due on Demand 100 100 — — Soomi Niihara(1) 12 % 12/7/2021 Due on Demand 700 700 — — Hope International Hospice, Inc.(1) 12 % 2/9/2022 Due on Demand 350 350 — — Hope International Hospice, Inc.(1) 10 % 2/15/2022 Due on Demand 210 210 — — Soomi Niihara(1) 10 % 2/15/2022 Due on Demand 100 100 — — Hope International Hospice, Inc.(1) 10 % 3/15/2022 Due on Demand 150 150 — — Hope International Hospice, Inc.(1) 10 % 3/30/2022 Due on Demand 150 150 — — Wei Peu Zen(2) 10 % 3/31/2022 Due on Demand 200 200 — — Willis C. Lee(2) 10 % 4/14/2022 Due on Demand 45 45 — — Hope International Hospice, Inc.(1) 12 % 5/25/2022 Due on Demand 40 40 — — Yutaka and Soomi Niihara(1) 12 % 7/27/2022 5 years 402 402 — 48 Hope International Hospice, Inc.(1) 10 % 8/15/2022 Due on Demand — 50 50 2 Yutaka and Soomi Niihara(1) 10 % 8/16/2022 5 years 250 250 — 25 Yutaka and Soomi Niihara(1) 10 % 8/16/2022 5 years 1,669 1,669 — 167 Hope International Hospice, Inc.(1) 12 % 8/17/2022 Due on Demand 50 50 — — Yutaka and Soomi Niihara(1) 10 % 8/17/2022 Due on Demand — 60 60 6 Seah Lim(2) 10 % 9/16/2022 3 years — 1,200 1,200 90 Hope International Hospice, Inc.(1) 10 % 10/20/2022 Due on Demand 100 100 — — Hope International Hospice, Inc.(1) 10 % 3/17/2023 Due on Demand 100 100 — — Yutaka and Soomi Niihara(1) 10 % 3/21/2023 Due on Demand 127 127 — — Wei Peu Zen(2) 60 % 12/1/2023 2 months 700 700 — — Subtotal $ 5,443 $ 6,753 $ 1,310 $ 338 Convertible note payable to related parties: Wei Peu Zen(2) 10 % 1/18/2023 1 - 2 years — 1,000 1,000 91 Subtotal $ — $ 1,000 $ 1,000 $ 91 Total $ 5,443 $ 7,753 $ 2,310 $ 429 (1) Dr. Niihara, a former Director and former Chairman and Chief Executive Officer of the Company, is also a director and the Chief Executive Officer of Hope International Hospice, Inc. (2) Officer or director. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | ||||
Feb. 22, 2021 | Mar. 31, 2024 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2023 | |
Summary Of Significant Accounting Policy [Line Items] | |||||
Net income (loss) | $ (4,348,000) | $ (3,451,000) | |||
Working capital deficit | 54,600,000 | ||||
Accounts receivable, net | 2,990,000 | $ 5,524,000 | |||
Other current liabilities | $ 14,858,000 | 14,681,000 | |||
Potentially dilutive securities outstanding | 112,942,491 | 61,174,436 | |||
Revision of Prior Period, Error Correction, Adjustment | |||||
Summary Of Significant Accounting Policy [Line Items] | |||||
Reclassification of warrants from equity to liability | $ 1,400,000 | ||||
Warrants issued for services | $ 1,500,000 | ||||
Prestige Capital Finance, LLC [Member] | Purchase and Sale Agreement [Member] | |||||
Summary Of Significant Accounting Policy [Line Items] | |||||
Cap on advances under agreement | $ 7,500,000 | ||||
Accounts receivable, net | $ 40,000 | 1,514,000 | |||
Other current liabilities | 1,000 | $ 24,000 | |||
Factoring fee | $ 87,000 | $ 108,000 | |||
Prestige Capital Finance, LLC [Member] | Purchase and Sale Agreement [Member] | Minimum [Member] | |||||
Summary Of Significant Accounting Policy [Line Items] | |||||
Percentage of down payment or advance receivable on face amount of accounts receivable at time of sale of accounts receivable | 65% | ||||
Percentage of discount fees on face amount of accounts receivable | 2.25% | ||||
Prestige Capital Finance, LLC [Member] | Purchase and Sale Agreement [Member] | Maximum [Member] | |||||
Summary Of Significant Accounting Policy [Line Items] | |||||
Percentage of down payment or advance receivable on face amount of accounts receivable at time of sale of accounts receivable | 80% | ||||
Percentage of discount fees on face amount of accounts receivable | 7.25% |
REVENUES (Details)
REVENUES (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation Of Revenue [Line Items] | ||
REVENUES, NET | $ 2,506 | $ 6,753 |
Endari [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
REVENUES, NET | 2,344 | 6,515 |
Other [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
REVENUES, NET | $ 162 | $ 238 |
REVENUES (Details 1)
REVENUES (Details 1) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation Of Revenue [Line Items] | ||
Beginning balance | $ 7,733 | $ 5,491 |
Provision related to sales in the current year | 807 | 1,350 |
Adjustments related to prior period sales | 1 | (83) |
Credits and payments made | (1,727) | (1,463) |
Ending balance | 6,814 | 5,295 |
Trade Discounts, Allowances and Chargebacks [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Beginning balance | 1,212 | 1,358 |
Provision related to sales in the current year | 205 | 425 |
Adjustments related to prior period sales | (50) | (213) |
Credits and payments made | (529) | (716) |
Ending balance | 838 | 854 |
Government Rebates and Other Incentives [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Beginning balance | 5,658 | 3,718 |
Provision related to sales in the current year | 577 | 819 |
Adjustments related to prior period sales | 51 | 130 |
Credits and payments made | (553) | (597) |
Ending balance | 5,733 | 4,070 |
Returns [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Beginning balance | 863 | 415 |
Provision related to sales in the current year | 25 | 106 |
Credits and payments made | (645) | (150) |
Ending balance | $ 243 | $ 371 |
REVENUES (Details 2)
REVENUES (Details 2) - Revenue Benchmark [Member] - Customer Concentration Risk [Member] | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Customer A [Member] | ||
Entity Wide Revenue Major Customer [Line Items] | ||
Concentration risk, percentage | 46% | 20% |
Customer B [Member] | ||
Entity Wide Revenue Major Customer [Line Items] | ||
Concentration risk, percentage | 39% | 15% |
Customer D [Member] | ||
Entity Wide Revenue Major Customer [Line Items] | ||
Concentration risk, percentage | 2% | 16% |
Customer F [Member] | ||
Entity Wide Revenue Major Customer [Line Items] | ||
Concentration risk, percentage | 1% | 23% |
REVENUES (Details Narrative)
REVENUES (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |||
Revenue from contract | $ 2,506 | $ 6,753 | |
Telcon, Inc. ("Telcon") [Member] | |||
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |||
Upfront payment | 10,000 | ||
Telcon, Inc. ("Telcon") [Member] | Distribution Agreement [Member] | |||
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | |||
Revenue from contract | $ 10,000 | $ 10,000 |
SELECTED FINANCIAL STATEMENT _4
SELECTED FINANCIAL STATEMENT - ASSETS (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Inventory Disclosure [Abstract] | ||
Raw materials and components | $ 1,313 | $ 1,329 |
Work-in-process | 200 | 186 |
Finished goods | 4,993 | 5,163 |
Inventory reserve | (4,979) | (4,967) |
Total inventories, net | $ 1,527 | $ 1,711 |
SELECTED FINANCIAL STATEMENT _5
SELECTED FINANCIAL STATEMENT - ASSETS (Details 1) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Prepaid Expense And Other Assets Current [Abstract] | ||
Prepaid insurance | $ 411 | $ 595 |
Prepaid expenses | 442 | 536 |
Other current assets | 762 | 596 |
Total prepaid expenses and other current assets | $ 1,615 | $ 1,727 |
SELECTED FINANCIAL STATEMENT _6
SELECTED FINANCIAL STATEMENT - ASSETS (Details 2) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Property and equipment | ||
Property and equipment, gross | $ 522 | $ 521 |
Less: accumulated depreciation | (465) | (462) |
Total property and equipment, net | 57 | 59 |
Equipment [Member] | ||
Property and equipment | ||
Property and equipment, gross | 384 | 383 |
Leasehold Improvements [Member] | ||
Property and equipment | ||
Property and equipment, gross | 39 | 39 |
Furniture and Fixtures [Member] | ||
Property and equipment | ||
Property and equipment, gross | $ 99 | $ 99 |
SELECTED FINANCIAL STATEMENT _7
SELECTED FINANCIAL STATEMENT - ASSETS (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Property Plant And Equipment [Abstract] | ||
Depreciation expense | $ 6,000 | $ 9,000 |
INVESTMENTS (Details Narrative)
INVESTMENTS (Details Narrative) ₩ / shares in Units, $ / shares in Units, ₩ in Millions | 1 Months Ended | 3 Months Ended | ||||||||||||||
Dec. 28, 2023 USD ($) | Dec. 28, 2023 JPY (¥) | Sep. 28, 2020 USD ($) $ / shares | Sep. 28, 2020 ₩ / shares | Oct. 31, 2018 USD ($) | Apr. 30, 2023 USD ($) | Apr. 30, 2023 KRW (₩) | Oct. 31, 2018 USD ($) | Mar. 31, 2024 USD ($) | Mar. 31, 2023 USD ($) | Mar. 31, 2024 KRW (₩) | Dec. 31, 2023 USD ($) | Dec. 31, 2023 KRW (₩) | Apr. 30, 2023 KRW (₩) | Dec. 31, 2018 USD ($) | Oct. 31, 2018 JPY (¥) | |
Schedule Of Investments [Line Items] | ||||||||||||||||
Call option agreement date | Sep. 28, 2020 | |||||||||||||||
Realized net gain on investment bond | $ 106,000 | |||||||||||||||
Translation adjustment, net of tax | $ 18,000 | $ 186,000 | ||||||||||||||
Net loan receivable from EJ Holdings | 16,869,000 | $ 16,869,000 | ||||||||||||||
Niihara International, Inc [Member] | ||||||||||||||||
Schedule Of Investments [Line Items] | ||||||||||||||||
Shares sale and assignment | $ 25,304 | ¥ 3,600,000 | ||||||||||||||
EJ Holdings, Inc. [Member] | ||||||||||||||||
Schedule Of Investments [Line Items] | ||||||||||||||||
Secured debt percentage | 1% | 1% | 1% | |||||||||||||
Investment amount | $ 32,000 | |||||||||||||||
Percentage of voting interest | 40% | |||||||||||||||
Unsecured debt | $ 13,600,000 | $ 13,600,000 | ||||||||||||||
Debt instrument, maturity date | Sep. 30, 2028 | |||||||||||||||
Unsecured debt, additional borrowings | 2,600,000 | |||||||||||||||
Loan receivables | 25,800,000 | 25,800,000 | ||||||||||||||
Translation adjustment, net of tax | $ 1,500,000 | |||||||||||||||
Net loan receivable from EJ Holdings | 16,900,000 | |||||||||||||||
EJ Holdings, Inc. [Member] | Japan Industrial Partners [Member] | ||||||||||||||||
Schedule Of Investments [Line Items] | ||||||||||||||||
Equity method investment, ownership percentage | 60% | |||||||||||||||
Unsecured Debt Due On December 28, 2027 [Member] | EJ Holdings, Inc. [Member] | ||||||||||||||||
Schedule Of Investments [Line Items] | ||||||||||||||||
Debt instrument, maturity date | Dec. 28, 2027 | |||||||||||||||
Aggregated principal amount | ¥ | ¥ 1,818,667,860 | |||||||||||||||
Maximum [Member] | ||||||||||||||||
Schedule Of Investments [Line Items] | ||||||||||||||||
Percentage of principal amount of convertible bond to be repurchased | 50% | |||||||||||||||
Telcon, Inc. ("Telcon") [Member] | ||||||||||||||||
Schedule Of Investments [Line Items] | ||||||||||||||||
Convertible bond maturity date | Oct. 16, 2030 | |||||||||||||||
Secured debt percentage | 2.10% | 2.10% | ||||||||||||||
Convertible bond initial conversion price | (per share) | $ 8 | ₩ 9,232 | ||||||||||||||
Convertible bond receivable | $ 17,500,000 | ₩ 23,600 | $ 17,500,000 | ₩ 23,600 | ||||||||||||
Convertible Bond Purchase Agreement [Member] | Telcon, Inc. ("Telcon") [Member] | ||||||||||||||||
Schedule Of Investments [Line Items] | ||||||||||||||||
Purchase of principal amount of convertible bond at face value | $ 26,100,000 | |||||||||||||||
API Supply Agreement [Member] | Telcon RF Pharmaceuticals, Inc. ("Telcon") [Member] | ||||||||||||||||
Schedule Of Investments [Line Items] | ||||||||||||||||
Offset amount against principal amount of convertible bond | 2,200,000 | ₩ 2,900 | ||||||||||||||
Cash proceeds to shortfall in revenue and profits | $ 236,000 | ₩ 307 | ||||||||||||||
API Supply Agreement [Member] | Telcon RF Pharmaceuticals, Inc. ("Telcon") [Member] | Maximum [Member] | ||||||||||||||||
Schedule Of Investments [Line Items] | ||||||||||||||||
Annual Profit | 2,500,000 | |||||||||||||||
API Supply Agreement [Member] | Telcon RF Pharmaceuticals, Inc. ("Telcon") [Member] | Minimum [Member] | ||||||||||||||||
Schedule Of Investments [Line Items] | ||||||||||||||||
Annual Revenue | $ 5,000,000 |
INVESTMENTS (Details)
INVESTMENTS (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2024 | Dec. 31, 2023 | |
Schedule Of Investments [Line Items] | ||
Balance, beginning of period | $ 20,978 | $ 19,971 |
Sales of convertible bond | (2,232) | |
Net gain on investment on convertible bond | 106 | |
Change in fair value included in the statement of other comprehensive income | (1,728) | 3,133 |
Balance, end of period | $ 19,250 | $ 20,978 |
Fair Value, Asset, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Gain Loss On Investment In Convertible Bond | Gain Loss On Investment In Convertible Bond |
Fair Value, Asset, Recurring Basis, Unobservable Input Reconciliation, Asset, Gain (Loss), Statement of Other Comprehensive Income or Comprehensive Income [Extensible Enumeration] | Other Comprehensive Income Unrealized Holding Gain Loss On Securities Arising During Period Net Of Tax | Other Comprehensive Income Unrealized Holding Gain Loss On Securities Arising During Period Net Of Tax |
INVESTMENTS (Details 1)
INVESTMENTS (Details 1) - Valuation Technique Binomial Monte-Carlo Cliquet Option Pricing Model [Member] ₩ / shares in Units, ₩ in Billions | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2024 KRW (₩) ₩ / shares | Dec. 31, 2023 KRW (₩) ₩ / shares | Mar. 31, 2024 $ / shares | Dec. 31, 2023 $ / shares | |
Schedule Of Investments [Line Items] | ||||
Principal outstanding (South Korean won) | ₩ | ₩ 23.6 | ₩ 23.6 | ||
Stock price | ₩ / shares | ₩ 804 | ₩ 873 | ||
Expected Life (in years) [Member] | ||||
Schedule Of Investments [Line Items] | ||||
Expected life (in years) | 6 years 6 months 14 days | 6 years 9 months 14 days | ||
Selected Yield [Member] | ||||
Schedule Of Investments [Line Items] | ||||
Investment in convertible bonds, measurement input | 12.75 | 12.25 | ||
Expected Volatility (Telcon common stock) [Member] | ||||
Schedule Of Investments [Line Items] | ||||
Investment in convertible bonds, measurement input | 71.10 | 71.90 | ||
Risk-free Interest Rate (South Korea government bond) [Member] | ||||
Schedule Of Investments [Line Items] | ||||
Investment in convertible bonds, measurement input | 3.37 | 3.16 | ||
Expected Dividend Yield [Member] | ||||
Schedule Of Investments [Line Items] | ||||
Investment in convertible bonds, measurement input | 0 | 0 | ||
Conversion Price [Member] | ||||
Schedule Of Investments [Line Items] | ||||
Conversion price | (per share) | ₩ 705 | ₩ 705 | $ 0.53 | $ 0.54 |
SELECTED FINANCIAL STATEMENT LI
SELECTED FINANCIAL STATEMENT LIABILITIES (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Accounts payable: | ||
Clinical and regulatory expenses | $ 670 | $ 696 |
Professional fees | 861 | 721 |
Selling expenses | 1,807 | 1,498 |
Manufacturing costs | 891 | 914 |
Non-employee director compensation | 839 | 766 |
Other vendors | 1,497 | 1,292 |
Total accounts payable | 6,565 | 5,887 |
Accrued interest payable, related parties | 587 | 542 |
Accrued interest payable | 2,516 | 3,122 |
Accrued expenses: | ||
Payroll expenses | 1,251 | 1,270 |
Government rebates and other rebates | 7,181 | 5,881 |
Due to customers | 844 | |
Other accrued expenses | 87 | 179 |
Total accrued expenses | 8,519 | 8,174 |
Total accounts payable and accrued expenses | $ 18,187 | $ 17,725 |
SELECTED FINANCIAL STATEMENT _8
SELECTED FINANCIAL STATEMENT LIABILITIES (Details 1) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 | |
Other Current Liabilities [Line Items] | |||
Other current liabilities | $ 14,858 | $ 14,681 | |
Unearned Revenue [Member] | |||
Other Current Liabilities [Line Items] | |||
Other current liabilities | [1] | 10,000 | 10,000 |
Trade Discount [Member] | |||
Other Current Liabilities [Line Items] | |||
Other current liabilities | 3,500 | 3,000 | |
Other Current Liabilities [Member] | |||
Other Current Liabilities [Line Items] | |||
Other current liabilities | $ 1,358 | $ 1,681 | |
[1] Refer to Note 3 for information regarding to the unearned revenue. |
SELECTED FINANCIAL STATEMENT _9
SELECTED FINANCIAL STATEMENT LIABILITIES (Details 2) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Other Long Term Liabilities [Line Items] | ||
Other long-term liabilities | $ 16,967 | $ 17,363 |
Trade Discount [Member] | ||
Other Long Term Liabilities [Line Items] | ||
Other long-term liabilities | 16,928 | 17,324 |
Other Long-Term Liabilities [Member] | ||
Other Long Term Liabilities [Line Items] | ||
Other long-term liabilities | $ 39 | $ 39 |
SELECTED FINANCIAL STATEMENT_10
SELECTED FINANCIAL STATEMENT LIABILITIES (Details Narrative) - USD ($) | 3 Months Ended | ||||
Jul. 12, 2017 | Jun. 12, 2017 | Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Summary Of Significant Accounting Policy [Line Items] | |||||
Accounts payables outstanding | $ 6,565,000 | $ 5,887,000 | |||
API Supply Agreement [Member] | Telcon, Inc. ("Telcon") [Member] | |||||
Summary Of Significant Accounting Policy [Line Items] | |||||
Proceeds from supply agreement | $ 31,800,000 | ||||
API Supply Agreement [Member] | Telcon, Inc. ("Telcon") [Member] | PGLG [Member] | |||||
Summary Of Significant Accounting Policy [Line Items] | |||||
PGLG, purchase price | 125,000 | $ 310,000 | |||
Accounts payables outstanding | $ 904,000 | $ 962,000 | |||
Revised API Agreement [Member] | Telcon, Inc. ("Telcon") [Member] | |||||
Summary Of Significant Accounting Policy [Line Items] | |||||
Annual purchase target amount | $ 5,000,000 | ||||
Target profit | $ 2,500,000 |
NOTES PAYABLE (Details)
NOTES PAYABLE (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2024 USD ($) Equity_Instrument $ / shares | Dec. 31, 2023 USD ($) Equity_Instrument $ / shares | |||
Debt Instrument [Line Items] | ||||
Principal Outstanding | $ 29,436 | $ 30,563 | ||
Unamortized Discount (Premium) | 125 | 617 | ||
Carrying Amount | $ 29,311 | $ 29,946 | ||
Underlying Shares Notes | Equity_Instrument | 103,226,084 | 116,906,234 | ||
2013 Notes payable [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 10% | 10% | ||
Term of Notes | Due on demand | Due on demand | ||
Principal Outstanding | $ 661 | $ 709 | ||
Carrying Amount | $ 661 | $ 709 | ||
2022 Notes payable [Member] | ||||
Debt Instrument [Line Items] | ||||
Term of Notes | Due on demand | Due on demand | ||
Principal Outstanding | $ 1,264 | $ 1,284 | ||
Carrying Amount | $ 1,264 | $ 1,284 | ||
2022 Notes payable [Member] | Minimum [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 10% | 10% | ||
2022 Notes payable [Member] | Maximum [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 12% | 12% | ||
2023 Notes payable [Member] | ||||
Debt Instrument [Line Items] | ||||
Term of Notes | Due on demand - 32 weeks | Due on demand - 56 months | ||
Term of Notes | 224 days | 56 months | ||
Principal Outstanding | $ 4,428 | $ 6,337 | ||
Unamortized Discount (Premium) | 33 | 115 | ||
Carrying Amount | $ 4,395 | $ 6,222 | ||
2023 Notes payable [Member] | Minimum [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 11% | 10% | ||
2023 Notes payable [Member] | Maximum [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 40% | 57% | ||
2024 Notes Payable [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 30% | |||
Term of Notes | 2 month | |||
Term of Notes | 2 months | |||
Principal Outstanding | $ 1,400 | |||
Carrying Amount | 1,400 | |||
Notes Payable [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal Outstanding | 7,753 | $ 8,330 | ||
Unamortized Discount (Premium) | 33 | 115 | ||
Carrying Amount | 7,720 | 8,215 | ||
Principal Outstanding, Current | 7,753 | 8,330 | ||
Unamortized Discount, Current | 33 | 115 | ||
Notes payable, current | $ 7,720 | $ 8,215 | ||
2020 Notes payable - related parties [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 12% | 12% | ||
Term of Notes | Due on demand | Due on demand | ||
Principal Outstanding | $ 100 | $ 100 | ||
Carrying Amount | $ 100 | $ 100 | ||
2021 Notes payable - related parties [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 12% | 12% | ||
Term of Notes | Due on demand | Due on demand | ||
Principal Outstanding | $ 700 | $ 700 | ||
Carrying Amount | $ 700 | $ 700 | ||
2022 Notes payable - related parties [Member] | ||||
Debt Instrument [Line Items] | ||||
Term of Notes | Due on demand - 5 years | Due on demand - 5 years | ||
Term of Notes | 5 years | 5 years | ||
Principal Outstanding | $ 3,716 | $ 3,716 | ||
Unamortized Discount (Premium) | 90 | 95 | ||
Carrying Amount | $ 3,626 | $ 3,621 | ||
2022 Notes payable - related parties [Member] | Minimum [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 10% | 6% | ||
2022 Notes payable - related parties [Member] | Maximum [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 12% | 12% | ||
2023 Notes payable - related parties [Member] | ||||
Debt Instrument [Line Items] | ||||
Term of Notes | Due on demand - 2 month | Due on demand - 2 months | ||
Term of Notes | 2 months | 2 years | ||
Principal Outstanding | $ 577 | $ 927 | ||
Carrying Amount | $ 577 | $ 927 | ||
2023 Notes payable - related parties [Member] | Minimum [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 10% | 10% | ||
2023 Notes payable - related parties [Member] | Maximum [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 60% | 60% | ||
Notes payable - related parties [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal Outstanding | $ 5,093 | $ 5,443 | ||
Unamortized Discount (Premium) | 90 | 95 | ||
Carrying Amount | 5,003 | 5,348 | ||
Principal Outstanding, Current | 2,772 | 3,122 | ||
Notes payable, current | 2,772 | 3,122 | ||
Principal Outstanding, Non Current | 2,321 | 2,321 | ||
Unamortized Discount, Non Current | 90 | 95 | ||
Notes payable, non-current | $ 2,231 | $ 2,226 | ||
2021 Convertible Notes Payable [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 10% | 2% | ||
Term of Notes | Due on demand | 3 years | ||
Term of Notes | 3 years | |||
Conversion Price | $ / shares | $ 0.13 | [1] | $ 0.13 | |
Principal Outstanding | $ 1,380 | $ 12,640 | ||
Unamortized Discount (Premium) | 0 | 407 | ||
Carrying Amount | $ 1,380 | $ 12,233 | ||
Underlying Shares Notes | Equity_Instrument | 12,605,099 | 113,009,154 | ||
2023 Convertible Notes Payable [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 12% | 13% | ||
Term of Notes | Due on demand | |||
Term of Notes | 6 months | |||
Conversion Price | $ / shares | [2] | $ 10 | $ 10 | |
Principal Outstanding | $ 3,150 | $ 3,150 | ||
Carrying Amount | $ 3,150 | $ 3,150 | ||
Underlying Shares Notes | Equity_Instrument | 347,535 | 337,326 | ||
2023 Convertible Notes Payable [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 10% | 10% | ||
Term of Notes | 6 months | 1 year | ||
Term of Notes | 1 year | |||
Conversion Price | $ / shares | $ 0.29 | $ 0.29 | ||
Principal Outstanding | $ 1,000 | $ 1,000 | ||
Unamortized Discount (Premium) | 2 | |||
Carrying Amount | $ 998 | $ 1,000 | ||
Underlying Shares Notes | Equity_Instrument | 3,645,725 | 3,559,754 | ||
2024 Convertible Notes Payable [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 10% | |||
Term of Notes | 1 year | |||
Conversion Price | $ / shares | $ 0.13 | |||
Principal Outstanding | $ 11,060 | |||
Unamortized Discount (Premium) | 0 | |||
Carrying Amount | $ 11,060 | |||
Underlying Shares Notes | Equity_Instrument | 86,627,725 | |||
Convertible Notes Payable [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 2% | |||
Principal Outstanding | $ 16,590 | $ 16,790 | ||
Unamortized Discount (Premium) | 2 | 407 | ||
Carrying Amount | $ 16,588 | $ 16,383 | ||
Underlying Shares Notes | Equity_Instrument | 103,226,084 | 116,906,234 | ||
Principal Outstanding, Current | $ 16,590 | $ 16,790 | ||
Unamortized Discount, Current | 2 | 407 | ||
Notes payable, current | $ 16,588 | $ 16,383 | ||
Underlying Shares Notes, Current | Equity_Instrument | 103,226,084 | 116,906,234 | ||
[1] The stated interest for the notes was 2 %. As the loan is default as of March 31, 2024, the default interest rate is applicable. This note is convertible into shares of EMI Holding, Inc., a wholly owned subsidiary of Emmaus Life Sciences, Inc . |
NOTES PAYABLE - (Parenthetical)
NOTES PAYABLE - (Parenthetical) (Details) | Mar. 31, 2024 |
Convertible Notes Payable [Member] | |
Debt Instrument [Line Items] | |
Interest rate | 2% |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) - USD ($) | 1 Months Ended | 2 Months Ended | ||||||||||||||||
Aug. 15, 2022 | Feb. 09, 2021 | Mar. 31, 2024 | Feb. 29, 2024 | Nov. 30, 2023 | Oct. 31, 2023 | Sep. 30, 2023 | Jul. 31, 2023 | Jun. 30, 2023 | May 31, 2023 | Mar. 31, 2023 | Jan. 31, 2023 | Dec. 31, 2022 | Aug. 31, 2022 | Jul. 31, 2022 | Mar. 31, 2024 | Mar. 05, 2024 | Dec. 31, 2023 | |
Debt Instrument [Line Items] | ||||||||||||||||||
Weighted-average stated annual interest rate | 12% | 12% | 12% | |||||||||||||||
Weighted-average effective annual interest rate | 13% | 13% | 23% | |||||||||||||||
Fair value of the conversion feature | $ 2,000 | $ 2,000 | $ 2,000 | |||||||||||||||
Issuance cost | $ 32,000 | |||||||||||||||||
Fair value of warrants | $ 84,000 | |||||||||||||||||
Purchased Amount [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Gain (loss) on debt extinguishment | $ (312,000) | |||||||||||||||||
Hope International Hospice, Inc. [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Principal amount | $ 50,000 | $ 100,000 | ||||||||||||||||
Interest rate | 10% | 10% | ||||||||||||||||
Prepayment amount | $ 1,924,819 | |||||||||||||||||
Convertible Promissory Note [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Conversion price | $ 0.13 | $ 0.13 | ||||||||||||||||
Interest rate | 10% | 10% | ||||||||||||||||
Business Loan and Security Agreement [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Principal amount | 2,200,000 | |||||||||||||||||
Net proceeds | $ 2,100,000 | |||||||||||||||||
Promissory Notes [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate | 10% | 12% | ||||||||||||||||
Debt instrument, maturity date | Aug. 16, 2027 | Jul. 31, 2027 | ||||||||||||||||
Promissory Notes [Member] | Unaffiliated Third Parties [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Principal amount | $ 1,668,751 | $ 402,000 | ||||||||||||||||
Promissory Notes [Member] | Personal Funds [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Principal amount | 250,000 | |||||||||||||||||
Demand Promissory Notes [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Principal amount | $ 2,800,000 | |||||||||||||||||
Dr. Niihara and His Wife [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Principal amount | $ 127,000 | |||||||||||||||||
Interest rate | 10% | |||||||||||||||||
Dr. Niihara and His Wife [Member] | Promissory Notes [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Principal amount | $ 1,576,574 | $ 370,000 | ||||||||||||||||
Wei Pei Zen [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Principal amount | $ 700,000 | |||||||||||||||||
Interest rate | 5% | |||||||||||||||||
Debt instrument, loan repaid | 350,000 | |||||||||||||||||
Wei Pei Zen [Member] | Smart Start Investments Limited [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Principal amount | $ 1,400,000 | $ 1,400,000 | ||||||||||||||||
Interest rate | 2.50% | 2.50% | ||||||||||||||||
Percentage of shareholding ownership held | 9.96% | 9.96% | ||||||||||||||||
Wei Pei Zen [Member] | Convertible Promissory Note [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Principal amount | $ 1,000,000 | |||||||||||||||||
Conversion price | $ 0.29 | |||||||||||||||||
Interest rate | 10% | |||||||||||||||||
Debt instrument, maturity date | Sep. 05, 2024 | |||||||||||||||||
Securities Purchase Agreement [Member] | Convertible Promissory Note [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Principal amount | $ 500,000 | |||||||||||||||||
Shares converted into common stock | 1,351,351 | |||||||||||||||||
Proceeds from convertible notes payable issued | $ 14,500,000 | |||||||||||||||||
Conversion price | $ 1.48 | $ 0.13 | $ 0.13 | |||||||||||||||
Debt instrument, frequency of periodic payment | The convertible promissory notes bear interest at the rate of 2% per year, payable semi-annually on the last business day of August and January of each year and will mature on the 3rd anniversary of the original issue date, unless earlier converted or prepaid. | |||||||||||||||||
Interest rate | 2% | |||||||||||||||||
Debt instrument, loan repaid | $ 200,000 | |||||||||||||||||
Securities Purchase Agreement [Member] | Maximum [Member] | Convertible Promissory Note [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Principal amount | $ 17,000,000 | |||||||||||||||||
Purchase and Sales of Future Receipts [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Installment payment | $ 103,500 | |||||||||||||||||
Purchase and Sales of Future Receipts [Member] | Purchased Amount [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Sale of accounts receivable | 3,105,000 | |||||||||||||||||
Proceeds from sale of notes receivable | $ 2,300,000 | |||||||||||||||||
Revenue Purchase Agreement [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Gain (loss) on debt extinguishment | $ (43,000) | $ (81,000) | ||||||||||||||||
Sale of accounts receivable | $ 762,200 | $ 1,377,500 | 828,000 | $ 528,200 | $ 700,212 | |||||||||||||
Proceeds from sale of notes receivable | 468,650 | 875,000 | 300,000 | 368,600 | $ 491,933 | |||||||||||||
Amount agreed to pay weekly sales receipts until future receipt is delivered | $ 49,000 | $ 81,000 | 26,000 | $ 19,000 | ||||||||||||||
Percentage of amount agreed to pay weekly until future receipt is delivered | 4% | |||||||||||||||||
Repayments of notes payable indebtedness | 204,000 | |||||||||||||||||
Revenue Beased Financing Agreement [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Gain (loss) on debt extinguishment | (87,000) | |||||||||||||||||
Sale of accounts receivable | 828,000 | $ 700,212 | ||||||||||||||||
Proceeds from sale of notes receivable | 276,000 | 492,132 | ||||||||||||||||
Amount agreed to pay weekly sales receipts until future receipt is delivered | 26,000 | $ 22,000 | ||||||||||||||||
Repayments of notes payable indebtedness | $ 222,000 | |||||||||||||||||
Exchange Agreement [Member] | Convertible Promissory Note [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Principal amount | $ 11,100,000 | $ 11,100,000 | ||||||||||||||||
Term of Notes | 1 year | |||||||||||||||||
Maturity year | 2024 | |||||||||||||||||
Conversion price | $ 0.13 | $ 0.13 | ||||||||||||||||
Interest rate | 2% | 2% | ||||||||||||||||
Gain (loss) on debt extinguishment | $ 1,000,000 | |||||||||||||||||
Standard Merchant Cash Advance Agreement [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Gain (loss) on debt extinguishment | $ (124,000) | |||||||||||||||||
Sale of accounts receivable | $ 877,560 | |||||||||||||||||
Proceeds from sale of notes receivable | 600,000 | |||||||||||||||||
Amount agreed to pay weekly sales receipts until future receipt is delivered | $ 34,000 |
NOTES PAYABLE (Details 1)
NOTES PAYABLE (Details 1) $ in Thousands | Mar. 31, 2024 USD ($) |
Long Term Debt By Maturity [Abstract] | |
2024 (nine months) | $ 27,115 |
2027 | 2,321 |
Total | $ 29,436 |
NOTES PAYABLE (Details 2)
NOTES PAYABLE (Details 2) - Convertible Promissory Notes [Member] - Conversion Feature Liabilities [Member] - Other Current Liabilities [Member] - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2024 | Dec. 31, 2023 | |
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Balance, beginning of period | $ 451 | $ 3,248 |
Change in fair value included in the statement of operations | $ 907 | $ (2,797) |
Fair Value, Liability, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Gain Loss On Conversion Feature Derivative Note Payable | Gain Loss On Conversion Feature Derivative Note Payable |
Balance, end of period | $ 1,358 | $ 451 |
NOTES PAYABLE (Details 3)
NOTES PAYABLE (Details 3) | 3 Months Ended | 12 Months Ended | |||
Mar. 05, 2024 $ / shares | Mar. 31, 2024 ₩ / shares | Dec. 31, 2023 ₩ / shares | Mar. 31, 2024 $ / shares | Dec. 31, 2023 $ / shares | |
Valuation Technique Binomial Monte-Carlo Cliquet Option Pricing Model [Member] | |||||
Debt Instrument [Line Items] | |||||
Stock price | ₩ / shares | ₩ 804 | ₩ 873 | |||
Valuation Technique Binomial Monte-Carlo Cliquet Option Pricing Model [Member] | Convertible Promissory Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Stock price | $ 0.11 | $ 0.10 | |||
Valuation Technique Binomial Monte-Carlo Cliquet Option Pricing Model [Member] | Conversion Price [Member] | |||||
Debt Instrument [Line Items] | |||||
Conversion price | (per share) | ₩ 705 | ₩ 705 | 0.53 | 0.54 | |
Valuation Technique Binomial Monte-Carlo Cliquet Option Pricing Model [Member] | Conversion Price [Member] | Convertible Promissory Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Conversion price | $ 0.13 | $ 0.13 | |||
Valuation Technique Binomial Monte-Carlo Cliquet Option Pricing Model [Member] | Selected Yield [Member] | Convertible Promissory Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Selected yield | 27.28 | 27.23 | 27.28 | 27.23 | |
Valuation Technique Binomial Monte-Carlo Cliquet Option Pricing Model [Member] | Expected Volatility [Member] | Convertible Promissory Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Selected yield | 50 | 50 | 50 | 50 | |
Valuation Technique Binomial Monte-Carlo Cliquet Option Pricing Model [Member] | Time Until Maturity [Member] | Convertible Promissory Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Expected life (in years) | 10 months 24 days | 1 month 28 days | |||
Valuation Technique Binomial Monte-Carlo Cliquet Option Pricing Model [Member] | Risk-free Interest Rate (South Korea government bond) [Member] | Convertible Promissory Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Selected yield | 5.10 | 5.51 | 5.10 | 5.51 | |
Valuation Technique Convertible Bond Lattice Model [Member] | Smart Start Convertible Note [Member] | |||||
Debt Instrument [Line Items] | |||||
Stock price | $ 0.1 | $ 0.11 | |||
Valuation Technique Convertible Bond Lattice Model [Member] | Conversion Price [Member] | Smart Start Convertible Note [Member] | |||||
Debt Instrument [Line Items] | |||||
Conversion price | $ 0.29 | $ 0.29 | |||
Valuation Technique Convertible Bond Lattice Model [Member] | Selected Yield [Member] | Smart Start Convertible Note [Member] | |||||
Debt Instrument [Line Items] | |||||
Selected yield | 25.75 | 28.2 | 28.2 | ||
Valuation Technique Convertible Bond Lattice Model [Member] | Expected Volatility [Member] | Smart Start Convertible Note [Member] | |||||
Debt Instrument [Line Items] | |||||
Selected yield | 50 | 50 | 50 | ||
Valuation Technique Convertible Bond Lattice Model [Member] | Time Until Maturity [Member] | Smart Start Convertible Note [Member] | |||||
Debt Instrument [Line Items] | |||||
Expected life (in years) | 6 months | 5 months 4 days | |||
Valuation Technique Convertible Bond Lattice Model [Member] | Risk-free Interest Rate (South Korea government bond) [Member] | Smart Start Convertible Note [Member] | |||||
Debt Instrument [Line Items] | |||||
Selected yield | 5.35 | 5.4 | 5.4 |
STOCKHOLDERS' DEFICIT (Details
STOCKHOLDERS' DEFICIT (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||
Jan. 27, 2023 | Jan. 12, 2023 | Jan. 31, 2023 | Sep. 30, 2022 | Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Sep. 29, 2021 | Feb. 09, 2021 | Dec. 31, 2018 | |
Class Of Warrant Or Right [Line Items] | |||||||||||
Warrants granted, term | 5 years | 5 years | |||||||||
Warrants granted to purchase common stock | 500,000 | ||||||||||
Warrant expired date | 2023-11 | 2023-11 | |||||||||
Weighted average remaining contractual life (years), outstanding | 1 year 10 months 24 days | ||||||||||
Share-based compensation | $ 170,000 | $ 1,189,000 | |||||||||
Change in fair value of warrants | (14,000) | ||||||||||
Warrant derivative liabilities | $ 74,000 | $ 65,000 | |||||||||
Change in fair value of derivative liabilities | (18,000) | ||||||||||
Warrant excercise price | $ 4.5 | $ 2.5 | |||||||||
Amended and Restated Warrants [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Number of common stock to be purchased | 2,375,000 | ||||||||||
Professional Relations and Consulting Service [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Warrants granted, term | 5 years | 5 years | |||||||||
Change in fair value of derivative liabilities | $ (8,000) | 94,000 | |||||||||
Warrant excercise price | $ 0.47 | $ 0.5 | |||||||||
Maximum [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Warrants granted to purchase common stock | 7,500,000 | ||||||||||
Maximum [Member] | Professional Relations and Consulting Service [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Warrants granted to purchase common stock | 500,000 | 250,000 | |||||||||
2011 Stock Incentive Option Plan [Member] | Stock Options [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Vesting period | 3 years | ||||||||||
Exercisable/expiration period | 10 years | ||||||||||
Expiration date | 2021-05 | ||||||||||
Stock option awards outstanding | 1,476,443 | 1,728,773 | |||||||||
Number of shares authorized under the plan | 9,000,000 | ||||||||||
2021 Stock Incentive Option Plan [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Unrecognized share-based compensation expense | $ 204,000 | ||||||||||
Vesting period | 1 year 6 months | ||||||||||
Exercisable/expiration period | 10 years | ||||||||||
Stock option awards outstanding | 3,610,000 | 1,250,000 | |||||||||
2021 Stock Incentive Option Plan [Member] | Stock Options [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Number of shares authorized under the plan | 4,000,000 | ||||||||||
2012 Omnibus Incentive Compensation Plan [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Stock option awards outstanding | 245,108 | 245,108 | |||||||||
2011 and 2021 Stock Incentive Option Plan [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Options granted | 2,360,000 | 1,250,000 | |||||||||
Stock option awards outstanding | 5,331,551 | 3,223,881 | 4,660,787 | ||||||||
2011 and 2021 Stock Incentive Option Plan [Member] | Stock Options [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Share-based compensation | $ 170,000 | 38,000 | |||||||||
Employees [Member] | 2021 Stock Incentive Option Plan [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Options granted | 1,620,000 | ||||||||||
Black-Scholes Merton model [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Warrant derivative liabilities | $ 85,000 | ||||||||||
Employee Director [Member] | 2021 Stock Incentive Option Plan [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Vesting period | 3 years | ||||||||||
Non-Employee Director [Member] | 2021 Stock Incentive Option Plan [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Options granted | 300,000 | ||||||||||
Vesting period | 1 year | ||||||||||
Consultants [Member] | 2021 Stock Incentive Option Plan [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Options granted | 440,000 | ||||||||||
General and Administrative Expense [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Aggregate estimated granted warrants | $ 334,000 | ||||||||||
Convertible Promissory Note [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Debt Instrument Interest Rate Stated Percentage | 10% | ||||||||||
Adjustment of warrants change in fair value increase additional paid in capital and accumulated loss | $ 41,000 | ||||||||||
Warrant excercise price | $ 0.37 | ||||||||||
Convertible Promissory Note [Member] | Securities Purchase Agreement [Member] | |||||||||||
Class Of Warrant Or Right [Line Items] | |||||||||||
Debt Instrument Interest Rate Stated Percentage | 2% |
STOCKHOLDERS' DEFICIT (Detail_2
STOCKHOLDERS' DEFICIT (Details 1) - $ / shares | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
Jan. 31, 2024 | Jan. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
S T I P2021 Plan [Member] | |||||
Class Of Warrant Or Right [Line Items] | |||||
Stock price | $ 0.11 | $ 0.31 | |||
Exercise Price | $ 0.15 | $ 4.5 | |||
Risk-Free Rate, Minimum | 3.80% | 3.51% | |||
Risk-Free Rate, Maximum | 3.81% | 3.53% | |||
Volatility, Minimum | 127.39% | 108.16% | |||
Volatility, Maximum | 136% | 116.40% | |||
Maximum [Member] | S T I P2021 Plan [Member] | |||||
Class Of Warrant Or Right [Line Items] | |||||
Expected term | 5 years 9 months | 6 years | |||
Minimum [Member] | S T I P2021 Plan [Member] | |||||
Class Of Warrant Or Right [Line Items] | |||||
Expected term | 5 years | 5 years | |||
Measurement Input, Share Price [Member] | |||||
Class Of Warrant Or Right [Line Items] | |||||
Stock price | $ 0.11 | $ 0.3 | $ 0.1 | ||
Measurement Input, Share Price [Member] | Maximum [Member] | |||||
Class Of Warrant Or Right [Line Items] | |||||
Stock price | $ 0.49 | ||||
Measurement Input, Share Price [Member] | Minimum [Member] | |||||
Class Of Warrant Or Right [Line Items] | |||||
Stock price | 0.31 | ||||
Measurement Input, Exercise Price [Member] | Maximum [Member] | |||||
Class Of Warrant Or Right [Line Items] | |||||
Exercise Price | 4.5 | 4.5 | 0.5 | ||
Measurement Input, Exercise Price [Member] | Minimum [Member] | |||||
Class Of Warrant Or Right [Line Items] | |||||
Exercise Price | $ 0.47 | $ 0.47 | $ 0.47 | $ 0.47 | |
Risk-free Interest Rate [Member] | |||||
Class Of Warrant Or Right [Line Items] | |||||
Risk-Free Rate | 3.62% | ||||
Risk-Free Rate, Minimum | 3.53% | 4.32% | 3.90% | ||
Risk-Free Rate, Maximum | 3.66% | 4.33% | 3.92% | ||
Expected Volatility [Member] | |||||
Class Of Warrant Or Right [Line Items] | |||||
Volatility, Minimum | 116.40% | 142.88% | 122.09% | 129.40% | |
Volatility, Maximum | 119.14% | 143.59% | 122.53% | 130.23% | |
Expected Life (in years) [Member] | |||||
Class Of Warrant Or Right [Line Items] | |||||
Expected life (in years) | 5 years | ||||
Expected Life (in years) [Member] | Maximum [Member] | |||||
Class Of Warrant Or Right [Line Items] | |||||
Expected life (in years) | 3 years 9 months 25 days | 4 years 9 months 29 days | 4 years 2 months 26 days | ||
Expected Life (in years) [Member] | Minimum [Member] | |||||
Class Of Warrant Or Right [Line Items] | |||||
Expected life (in years) | 3 years 9 months 10 days | 4 years 9 months 10 days | 4 years 10 days |
STOCKHOLDERS' DEFICIT (Detail_3
STOCKHOLDERS' DEFICIT (Details 2) - Warrant [Member] - $ / shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2024 | Dec. 31, 2023 | |
Class Of Warrant Or Right [Line Items] | ||
Warrants outstanding, beginning | 4,732,391 | 6,610,520 |
Granted | 0 | 8,500,000 |
Cancelled, forfeited or expired | 0 | (10,378,129) |
Warrants outstanding, ending | 4,732,391 | 4,732,391 |
Warrants exercisable ending | 4,732,391 | 4,732,391 |
Weighted Average Exercise Price, Outstanding | $ 0.95 | $ 2.22 |
Granted | 0 | 4.03 |
Cancelled, forfeited or expired | 0 | 4.23 |
Weighted Average Exercise Price, Outstanding | 0.95 | 0.95 |
Weighted Average Exercise Price, Exercisable | $ 0.95 | $ 0.95 |
STOCKHOLDERS' DEFICIT (Detail_4
STOCKHOLDERS' DEFICIT (Details 3) - $ / shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2024 | Dec. 31, 2023 | |
2021 Stock Incentive Option Plan [Member] | ||
Class Of Warrant Or Right [Line Items] | ||
Number of Options outstanding, beginning | 1,250,000 | |
Number of Options outstanding, end | 3,610,000 | 1,250,000 |
2011 and 2021 Stock Incentive Option Plan [Member] | ||
Class Of Warrant Or Right [Line Items] | ||
Number of Options outstanding, beginning | 3,223,881 | 4,660,787 |
Number of Options, Granted or deemed granted | 2,360,000 | 1,250,000 |
Number of Options, Cancelled, forfeited and expired | (252,330) | (2,686,906) |
Number of Options outstanding, end | 5,331,551 | 3,223,881 |
Number of Options, Options exercisable | 4,350,051 | 2,373,881 |
Number of Options, Options available for future grant | 360,000 | 2,750,000 |
Weighted-Average Exercise Price, Options outstanding, beginning | $ 5.97 | $ 5.08 |
Weighted-Average Exercise Price, Granted or deemed granted | 0.15 | 4.5 |
Weighted-Average Exercise Price, Cancelled, forfeited and expired | 3.2 | 3.74 |
Weighted-Average Exercise Price, Options outstanding, end | 3.52 | 5.97 |
Weighted-Average Exercise Price, Options exercisable | $ 3.73 | $ 6.5 |
INCOME TAX (Details Narrative)
INCOME TAX (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | ||
State income tax (benefit) and provision | $ (7,000) | $ 49,000 |
Unrecognized tax benefits | 0 | $ 0 |
Federal income tax provision | $ 0 |
LEASES (Details Narrative)
LEASES (Details Narrative) | 3 Months Ended | ||
Mar. 31, 2024 USD ($) ft² | Mar. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) | |
Leases [Line Items] | |||
Lease expense | $ 301,000 | $ 303,000 | |
Right of use assets | 2,082,000 | $ 2,337,000 | |
Operating lease liabilities | $ 2,430,000 | ||
Weighted average remaining term of leases | 2 years 6 months | ||
Weighted average discount rate | 12.90% | ||
Torrance, California [Member] | |||
Leases [Line Items] | |||
Operating lease, lease space | ft² | 21,293 | ||
Operating lease, base rental per month | $ 87,514 | ||
Operating lease, expiration date | Sep. 30, 2026 | ||
Dubai, United Arb Emirates [Member] | |||
Leases [Line Items] | |||
Operating lease, lease space | ft² | 1,163 | ||
Operating lease, expiration date | Jun. 19, 2026 |
LEASES (Details)
LEASES (Details) $ in Thousands | Mar. 31, 2024 USD ($) |
Leases [Abstract] | |
2024 (nine months) | $ 828 |
2025 | 1,132 |
2026 | 846 |
Total lease payments | 2,806 |
Less: Interest | 376 |
Present value of lease liabilities | $ 2,430 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) - Telcon RF Pharmaceuticals, Inc. ("Telcon") [Member] $ in Millions | Jul. 12, 2017 USD ($) Number | Jun. 12, 2017 USD ($) |
API Supply Agreement [Member] | ||
Proceeds from supply agreement | $ 31.8 | |
API Supply Agreement [Member] | PGLG [Member] | ||
Percentage of right to supply | 25% | |
Agreement term | 15 years | |
Revised API Agreement [Member] | ||
Agreement term | 5 years | |
Number of renewals | Number | 10 | |
Cumulative purchase amount | $ 47 | |
Annual purchase target amount | 5 | |
Target profit | $ 2.5 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Dec. 31, 2023 | ||
Short-term Debt [Line Items] | |||
Principal Amount Outstanding | $ 29,436 | $ 30,563 | |
Willis Lee [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [1] | 12% | 12% |
Date of Loan | [1] | Oct. 29, 2020 | Oct. 29, 2020 |
Term of Loan | [1] | Due on Demand | Due on Demand |
Principal Amount Outstanding | [1] | $ 100 | $ 100 |
Highest Principal Outstanding | [1] | $ 100 | $ 100 |
Soomi Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 12% | 12% |
Date of Loan | [2] | Dec. 07, 2021 | Dec. 07, 2021 |
Term of Loan | [2] | Due on Demand | Due on Demand |
Principal Amount Outstanding | [2] | $ 700 | $ 700 |
Highest Principal Outstanding | [2] | $ 700 | $ 700 |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Feb. 09, 2022 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 350 | |
Highest Principal Outstanding | [2] | $ 350 | |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Feb. 15, 2022 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 210 | |
Highest Principal Outstanding | [2] | $ 210 | |
Soomi Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Feb. 15, 2022 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 100 | |
Highest Principal Outstanding | [2] | $ 100 | |
Soomi Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Feb. 15, 2022 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 100 | |
Highest Principal Outstanding | [2] | $ 100 | |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 12% | 10% |
Date of Loan | [2] | Mar. 15, 2022 | Mar. 15, 2022 |
Term of Loan | [2] | Due on Demand | Due on Demand |
Principal Amount Outstanding | [2] | $ 150 | $ 150 |
Highest Principal Outstanding | [2] | $ 150 | $ 150 |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 12% | 10% |
Date of Loan | [2] | Mar. 30, 2022 | Mar. 30, 2022 |
Term of Loan | [2] | Due on Demand | Due on Demand |
Principal Amount Outstanding | [2] | $ 150 | $ 150 |
Highest Principal Outstanding | [2] | $ 150 | $ 150 |
Wei Peu Derek Zen [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [1] | 10% | 10% |
Date of Loan | [1] | Mar. 31, 2022 | Mar. 31, 2022 |
Term of Loan | [1] | Due on Demand | Due on Demand |
Principal Amount Outstanding | [1] | $ 200 | $ 200 |
Highest Principal Outstanding | [1] | $ 200 | $ 200 |
Willis Lee [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [1] | 10% | 10% |
Date of Loan | [1] | Apr. 14, 2022 | Apr. 14, 2022 |
Term of Loan | [1] | Due on Demand | Due on Demand |
Principal Amount Outstanding | [1] | $ 45 | $ 45 |
Highest Principal Outstanding | [1] | $ 45 | $ 45 |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | 12% |
Date of Loan | [2] | May 25, 2022 | May 25, 2022 |
Term of Loan | [2] | Due on Demand | Due on Demand |
Principal Amount Outstanding | [2] | $ 40 | $ 40 |
Highest Principal Outstanding | [2] | $ 40 | $ 40 |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Mar. 17, 2023 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 100 | |
Highest Principal Outstanding | [2] | $ 100 | |
Yutaka And Soomi Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 12% | 12% |
Date of Loan | [2] | Jul. 27, 2022 | Jul. 27, 2022 |
Term of Loan | [2] | 5 years | 5 years |
Principal Amount Outstanding | [2] | $ 402 | $ 402 |
Highest Principal Outstanding | [2] | 402 | 402 |
Amount of Interest Paid | [2] | $ 12 | $ 48 |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Aug. 15, 2022 | |
Term of Loan | [2] | Due on Demand | |
Highest Principal Outstanding | [2] | $ 50 | |
Amount of Principal Repaid or Converted to Shares | [2] | 50 | |
Amount of Interest Paid | [2] | $ 2 | |
Yutaka And Soomi Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | 10% |
Date of Loan | [2] | Aug. 16, 2022 | Aug. 16, 2022 |
Term of Loan | [2] | 5 years | 5 years |
Principal Amount Outstanding | [2] | $ 250 | $ 250 |
Highest Principal Outstanding | [2] | 250 | 250 |
Amount of Interest Paid | [2] | $ 6 | $ 25 |
Yutaka And Soomi Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | 10% |
Date of Loan | [2] | Aug. 16, 2022 | Aug. 16, 2022 |
Term of Loan | [2] | 5 years | 5 years |
Principal Amount Outstanding | [2] | $ 1,669 | $ 1,669 |
Highest Principal Outstanding | [2] | 1,669 | 1,669 |
Amount of Interest Paid | [2] | $ 42 | $ 167 |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | 12% |
Date of Loan | [2] | Aug. 17, 2022 | Aug. 17, 2022 |
Term of Loan | [2] | Due on Demand | Due on Demand |
Principal Amount Outstanding | [2] | $ 50 | $ 50 |
Highest Principal Outstanding | [2] | $ 50 | $ 50 |
Yutaka And Soomi Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Aug. 17, 2022 | |
Term of Loan | [2] | Due on Demand | |
Highest Principal Outstanding | [2] | $ 60 | |
Amount of Principal Repaid or Converted to Shares | [2] | 60 | |
Amount of Interest Paid | [2] | $ 6 | |
Seah Lim [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [1] | 10% | |
Date of Loan | [1] | Sep. 16, 2022 | |
Term of Loan | [1] | 3 years | |
Highest Principal Outstanding | [1] | $ 1,200 | |
Amount of Principal Repaid or Converted to Shares | [1] | 1,200 | |
Amount of Interest Paid | [1] | $ 90 | |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | 10% |
Date of Loan | [2] | Oct. 20, 2022 | Oct. 20, 2022 |
Term of Loan | [2] | Due on Demand | Due on Demand |
Principal Amount Outstanding | [2] | $ 100 | $ 100 |
Highest Principal Outstanding | [2] | $ 100 | $ 100 |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Mar. 17, 2023 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 100 | |
Highest Principal Outstanding | [2] | $ 100 | |
Yutaka and Soomi Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Mar. 21, 2023 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 127 | |
Highest Principal Outstanding | [2] | $ 127 | |
Yutaka and Soomi Niihara [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Mar. 21, 2023 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 127 | |
Highest Principal Outstanding | [2] | $ 127 | |
Wei Peu Derek Zen [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [1] | 60% | 10% |
Date of Loan | [1] | Dec. 01, 2023 | Jan. 18, 2023 |
Term of Loan | [1] | 2 months | 1 - 2 years |
Principal Amount Outstanding | [1] | $ 350 | |
Highest Principal Outstanding | [1] | 700 | $ 1,000 |
Amount of Principal Repaid or Converted to Shares | [1] | 350 | 1,000 |
Amount of Interest Paid | [1] | 70 | $ 91 |
Yasushi Nagasaki [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [1] | 60% | |
Date of Loan | [1] | Dec. 01, 2023 | |
Term of Loan | [1] | 2 months | |
Principal Amount Outstanding | [1] | $ 700 | |
Highest Principal Outstanding | [1] | $ 700 | |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 12% | |
Date of Loan | [2] | Feb. 09, 2022 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 350 | |
Highest Principal Outstanding | [2] | $ 350 | |
Hope International Hospice, Inc. [Member] | |||
Short-term Debt [Line Items] | |||
Interest Rate | [2] | 10% | |
Date of Loan | [2] | Feb. 15, 2022 | |
Term of Loan | [2] | Due on Demand | |
Principal Amount Outstanding | [2] | $ 210 | |
Highest Principal Outstanding | [2] | 210 | |
Promissory note payable to related parties [Member] | |||
Short-term Debt [Line Items] | |||
Principal Amount Outstanding | 5,093 | 5,443 | |
Highest Principal Outstanding | 5,443 | 6,753 | |
Amount of Principal Repaid or Converted to Shares | 350 | 1,310 | |
Amount of Interest Paid | 130 | 338 | |
Convertible notes payable - related parties [Member] | |||
Short-term Debt [Line Items] | |||
Highest Principal Outstanding | 1,000 | ||
Amount of Principal Repaid or Converted to Shares | 1,000 | ||
Amount of Interest Paid | 91 | ||
Promissory note and Convertible notes payable to related parties [Member] | |||
Short-term Debt [Line Items] | |||
Principal Amount Outstanding | 5,093 | 5,443 | |
Highest Principal Outstanding | 5,443 | 7,753 | |
Amount of Principal Repaid or Converted to Shares | 350 | 2,310 | |
Amount of Interest Paid | $ 130 | $ 429 | |
[1] Officer or director. Dr. Niihara, a former Director and former Chairman and Chief Executive Officer of the Company, is also a director and the Chief Executive Officer of Hope International Hospice, Inc. |
RELATED PARTY TRANSACTIONS (D_2
RELATED PARTY TRANSACTIONS (Details Narrative) - Telcon, Inc. ("Telcon") [Member] $ in Millions, ₩ in Billions | Mar. 31, 2024 KRW (₩) shares | Mar. 31, 2024 USD ($) shares | Dec. 31, 2023 KRW (₩) | Dec. 31, 2023 USD ($) |
Related Party Transaction [Line Items] | ||||
Marketable securities common stock outstanding | 4,147,491 | 4,147,491 | ||
Percentage of marketable securities common stock outstanding | 6.70% | 6.70% | ||
Convertible bond receivable | ₩ 23.6 | $ 17.5 | ₩ 23.6 | $ 17.5 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) ₩ in Millions | 1 Months Ended | |||||||||||
May 31, 2024 USD ($) | Apr. 30, 2024 KRW (₩) | Apr. 30, 2024 USD ($) | Nov. 30, 2023 USD ($) | Oct. 31, 2023 USD ($) | Jul. 31, 2023 USD ($) | May 31, 2023 USD ($) | Apr. 30, 2023 KRW (₩) | Apr. 30, 2023 USD ($) | Mar. 31, 2023 USD ($) | Apr. 30, 2024 USD ($) | Apr. 30, 2023 USD ($) | |
Revenue Purchase Agreement [Member] | ||||||||||||
Subsequent Event [Line Items] | ||||||||||||
Sale of accounts receivable | $ 762,200 | $ 1,377,500 | $ 828,000 | $ 528,200 | $ 700,212 | |||||||
Proceeds from sale of notes receivable | 468,650 | 875,000 | 300,000 | 368,600 | $ 491,933 | |||||||
Amount agreed to pay weekly sales receipts until future receipt is delivered | $ 49,000 | $ 81,000 | $ 26,000 | $ 19,000 | ||||||||
Telcon RF Pharmaceuticals, Inc. ("Telcon") [Member] | API Supply Agreement [Member] | ||||||||||||
Subsequent Event [Line Items] | ||||||||||||
Offset amount against principal amount of convertible bond | ₩ 2,900 | $ 2,200,000 | ||||||||||
Cash proceeds to shortfall in revenue and profits | ₩ 307 | $ 236,000 | ||||||||||
Subsequent Event [Member] | Revenue Purchase Agreement [Member] | ||||||||||||
Subsequent Event [Line Items] | ||||||||||||
Sale of accounts receivable | $ 1,628,000 | |||||||||||
Proceeds from sale of notes receivable | 1,001,000 | |||||||||||
Amount agreed to pay weekly sales receipts until future receipt is delivered | $ 58,143 | |||||||||||
Subsequent Event [Member] | Telcon RF Pharmaceuticals, Inc. ("Telcon") [Member] | API Supply Agreement [Member] | ||||||||||||
Subsequent Event [Line Items] | ||||||||||||
Offset amount against principal amount of convertible bond | ₩ 3,500 | $ 2,500,000 | ||||||||||
Cash proceeds to shortfall in revenue and profits | ₩ 893 | $ 640,000 |